With Ezetap in the bag, Razorpay CEO Harshil Mathur eyes top spot among omnichannel payment providers

Razorpay founders Shashank Kumar and Harshil Mathur

As lines blur between online payments and digital payments made for physical purchases, Razorpay is joining a host of other service providers that offer a single platform for businesses to accept online as well as offline digital payments.

Moneycontrol had reported on August 16 that Tiger Global and Sequoia-backed Razorpay has acquired Bengaluru-based point-of-sale (POS) machines and contactless payments provider Ezetap.

While the regulatory filings have only been made for 80 percent of the stake sale, Razorpay founder and CEO Harshil Mathur told Moneycontrol that the company will acquire 100 percent of Ezetap, filings for which will be made in the coming days.

While Mathur did not comment on the deal amount, it is estimated to be between $150 million and $200 million, according to sources, making it Razorpay’s largest acquisition till date.

“The main vision is to provide a single platform for businesses to manage all financial products. Offline payments are still a significant portion for a lot of businesses which we cannot leave out of offerings,” Mathur said.

According to industry estimates, Razorpay has a 15-20 percent market share among payment gateways, second only to Billdesk’s share. The company’s customers largely include online businesses and startups such as Meta, Ola, Zomato, Swiggy, Cred, Yatra, and Nykaa. It also caters to the Indian Railway Catering and Tourism Corporation (IRCTC), Muthoot Finance, National Pension System and Indian Oil, among others.

Ezetap’s customers include BigBasket, Bharti Airtel, Reliance, Decathlon, Amazon, Xiaomi and even Indian Oil Corporation which Razorpay caters to for online payments. The company, which has raised about $60 million to date, counts Helion Venture Partners, Social Capital and JS Capital as its backers.

With the integration, Razorpay can offer offline payments to its payment gateway customers and vice versa for Ezetap customers.

“Fifteen percent of our current customer base will need offline payments in some form. Ezetap, on the other hand, was powering card on delivery for many large brands. So the synergy is easier to realise when we put both together,” Mathur said.

Ezetap has processed $10 billion in Gross Transaction Values (GTV) across 5 lakh merchants. With this acquisition, Razorpay will compete with PoS players like Pine Labs, Infibeam Avenues, MSwipe, BharatPe and Paytm.

Of all the players, Razorpay and Pine Labs had been vying for similar customers in the online and offline space respectively. In October 2021, Pine Labs too had announced an omnichannel strategy with the launch of its payment gateway named Plural.

In a recent interview with news agency Reuters, Pine Labs CEO Amrish Rau had said that it is targeting monthly transactions worth $4-5 billion in the next two years from Plural. Currently, the platform is processing $380 million in transactions monthly.

According to Mathur, “While there are players who have online and offline presence, none have as significant an integration as we have post this acquisition. That will allow us to scale significantly and emerge as the largest omnichannel payments provider.”

Founded in 2014 by IIT Roorkee graduates Mathur and Shashank Kumar, Razorpay is aiming for $90 billion in Total Payment Volumes (TPV) in 2022.

Sanjay Swamy, Managing Partner at Ezetap's backer Prime Venture Partner said, "The acquisition of Ezetap by Razorpay to drive Omni-Channel payments is not just a seminal moment in the online meets offline world - its a coming of age moment in the Indian startup ecosystem."

"Ezetap was the first company in the Prime Venture Partners' portfolio and through its entire journey experienced a lot of changes in Payments Infrastructure and regulations - yet adapted smoothly and swiftly to build a profitable and scalable business," he added.

Ezetap was founded by Abhijit Bose and Bhaktha Keshavachar, both of whom moved on from the startup in 2019. Bose joined Whatsapp as Head of India, while Keshavachar founded Chara Technologies.