This will be the first time the startup has received external financing

India-based fintech startup Cashfree has raised US$120,000 in seed funding from renowned Silicon Valley incubator Y Combinator. This will be the startup’s first external source of financing.

According to a DealStreetAsia report, Cashfree will use the money to fund the growth of its sales and engineering teams, ramp up product development as well as boost market engagement and strengthen its relationships with banks.

Founded in 2015 by Akash Sinha and Reeju Datta, Cashfree provides a payment gateway that automates inbound and outbound bank transfers for merchant bulk payments. Previously, most merchants in India only have the option of organising bulk payments manually through Microsoft Excel or a similar software.

Cashfree’s payment gateway is currently used for a variety of e-payment options, including crowdfunding, loan disbursals and repayment for lenders, payrolls for on-demand economy workers and marketplace vendor settlements.

It is also used to process immediate refunds.

Also Read: Grab to begin trialling its merchant payment system in early Novermber

To date, Cashfree claims to log over Rs 50 Crores (US$770,000) per month from its pool of 1,100 merchants.

“The products we have built are first of their kind and are helping businesses scale and innovate faster. We already are a profitable business and are looking to process 200 Crores (US$3.8 million) of monthly payments by the end of the year,” said Co-founder Akash Sinha, in an official press statement.

Going forward, the company is talking to investors to raise a larger round to scale its merchant acquisition and engineering teams.

“Payments innovation will play a major role in shaping the Indian economy. Cashfree has identified payment problems which existing payment companies haven’t been solving. We believe they have the right team to execute it.”, said Michael Seibel, CEO and Partner, Y Combinator.
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Image Credit: Cashfree

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