Zeta, a banking technology provider, has raised $50 million in a strategic investment round, pushing its valuation to $2 billion, the company said in a statement.
This marks a significant jump from its pre-money valuation of $1.15 billion when Zeta secured $250 million from SoftBank Vision Fund 2 and other investors in 2021.
The latest round was led by American healthcare company Optum, sources said. The funding comes at a time when there is rising investor interest in the banking tech segment.
The fintech unicorn plans to use the funds for expansion and product development.
"We are incredibly excited at the pace at which clients are embracing our modern stack," said Zeta global CEO and co-founder Bhavin Turakhia.
Over the past few years, the company has supported more than 25 million accounts on its cloud-native processing platform, Tachyon, and is on track to add 25 million more with contracts already in flight, he claimed.
“Our clients are breaking away from decades of legacy systems to deliver amazing digital experiences thereby increasing their customer satisfaction and accelerating new user acquisition," he added.
Founded in 2015 by Turakhia and Ramki Gaddipati, Zeta’s SaaS offerings enable banks and fintech firms to launch any asset, liability or payment products. These include credit cards, checking accounts, savings accounts and unsecured loans.
Zeta counts financial institutions including HDFC Bank as its clients where it has launched a suite of products and Pixel – a digital-native credit card programme, Pluxee, a global corporate benefits provider, and Sparrow Financial, a card issuer for non-prime cardholders in the US.
As of October, Zeta was processing around 2 million transactions a day amid growing demand for credit on UPI products. The firm launched its credit-on-UPI stack in May, helping banks originate, distribute, and collect digitally and it aims to capture 50 percent of the market with this product.
Credit on UPI refers to the integration of credit cards and other credit facilities with the UPI system in India.
Zeta has around 1,700 employees, over 70 percent of them in technology roles across locations in the US and Asia.
Zeta has raised $340 million from investors, including SoftBank and Mastercard. The firm's revenue model is pay-per-use.
In FY24, Zeta India parent Better World Technologies Private Ltd’s profit after tax surged 5.4x to Rs 119.82 crore from the previous year. Its revenue grew 9.42 percent to Rs 893.12 crore.
Zeta's funding comes amid a growing investor interest in the segment. Five months ago, Application Programming Interface (API) infrastructure company M2P Fintech raised Rs 850 crore (around $102 million) led by Africa-based Helios Investment Partners through a mix of primary and secondary share capital.
Fintech infrastructure firm Juspay is in talks to raise $150 million in its latest funding round, led by Kedaara Capital with participation from WestBridge and SoftBank.
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