Financial services company DMI Group has acquired beleaguered buy-now-pay-later (BNPL) startup ZestMoney, the former announced in a press release on Thursday. Details about the deal size have not been disclosed.
This acquisition will enable DMI to widen its engagement with current and potential customers by adding the ZestMoney checkout financing platform to its product suite. The group will bring its customer base, balance-sheet strength and risk-management experience to drive growth across ZestMoney’s online and offline merchant networks.
DMI Finance, the NBFC subsidiary of DMI, will be the preferred lender on the Zest platform. As a result of the acquisition, DMI will have the exclusive right to the use of all the Zest brands, the release said.
In December, ZestMoney had informed employees that it will be winding down operations by the end of 2023, and will let go of the remaining 150 employees. ZestMoney once had a 500-strong workforce. Troubles for the BNPL startup began when fintech firm PhonePe had decided to halt its acquisition of the Bengaluru-based firm.
“ZestMoney has been a pioneering provider of checkout finance in India. We are always looking for best-in-class solutions to enhance the engagement with and the experience of our customer and merchant base,” said Shivashish Chatterjee, co-founder and joint managing director, DMI. DMI has partnered with ZestMoney for more than eight years in various capacities.
Founded in 2008, DMI is a financial services platform with core businesses in digital finance, housing finance and asset management. The group runs DMI Finance which is a pure-play digital lender with products including consumption, personal and MSME loans. In April 2023, DMI Finance announced the closure of a $400-million equity round led by Mitsubishi UFJ Financial Group.
Founded in 2015, Zest is a fully automated digital customer onboarding and servicing system, enabling customers to apply for and receive digital credit instantly at the point of sale. It has more than 80,000 merchants including Amazon, Flipkart, Myntra, MakeMyTrip, Nykaa, Samsung, Apple, Vivo, Croma, and Reliance Digital.
“DMI has been at the forefront of digital lending in India. It brings strong capital support and deep expertise. DMI has been an early supporter of ZestMoney and we are very excited to take our partnership to a whole new level,” ZestMoney chief operating officer Mandar Satpute said.