Indian fintech ZestMoney has received an acquisition offer from micro-lending start-up KreditPE, amid reports that ZestMoney is closing its operations. The offer, tabled by KreditPE founder, Ashwin Bhambri, has proposed running the two companies simultaneously while focusing on innovation and frugality. Bhambri stated that if KreditPE acquires ZestMoney, a product could be created that will be more successful than digital payments app, PhonePe.
- ZestMoney has recently been in the news for problems with its fundraising efforts and the collapse of a potential acquisition deal with digital payment platform, PhonePe.
- Bhambri has suggested creating a postpaid UPI (Unified Payments Interface) wallet service through a merger of KreditPE and ZestMoney.
- Bhambri also made it clear that KreditPE’s strategy is to provide consumer finance to users who are vetted by KreditPE.
- ZestMoney is reportedly shutting down operations by the end of December and will let go 150 employees currently working with the company.
- In May, ZestMoney’s three co-founders, Lizzie Chapman, Priya Sharma, and Ashish Anantharaman, resigned following the company’s inability to raise new funding or secure an acquisition deal with PhonePe.
- Prosus, a significant investor in ZestMoney, wrote off its $38 million investment in the company earlier this year. Prosus held a sizable 19.4% stake in the Bengaluru-based firm.
However, it’s unclear at this stage whether ZestMoney will accept KreditPE’s acquisition offer. The uncertain future of ZestMoney highlights the challenges facing fintech companies in a highly competitive and rapidly evolving market.
