Ahead of its plans to expand into the United States, Pine Labs has acquired fintech infrastructure specialist Setu, in a cash and equity deal totalling upto around $70-75 Mn.
Post acquisition, Setu will retain its identity and continue to function independently under the leadership of it’s current team. Access to Setu’s API would function as gateway for Pine Labs’ entry into embedded finance. The Tech Portal had earlier reported Pine Labs’ plans to acquire Setu in April 2022.
Amrish Rau, CEO at Pine Labs, said “Payment transactions are becoming more and more embedded. In the future, data and identity will also be delivered in a frictionless manner. This is where Setu has done some tremendous work. If we can provide embedded finance and delivery open API Infrastructure to our merchants, the combination between Setu and Plural will be important.”
Founded in 2018 by Nikhil Kumar and Sahil Kini, Setu is an API (Application programing interface) service provider that offers API for an umbrella-like integration of multiple Fintech services like on-the-fly Credit lines, Debit card insurances etc. to financial institutions like banks, insurance companies, AMCs etc. Setu offers open APIs across four categories, namely data, payments, investments and lending.
“I am looking at this acquisition as a completion between an online payment stack and an embedded fintech stack. Both those coming together make it extremely powerful,” Rau added.
Pine Labs, whose chief product is Point-of-Scale (PoS) offline payment machines (the bulky devices that gas stations use for card payments), have been aggressively working towards expansion and diversification. Last year, the company launched it’s online payments product, Plural. Pine Labs also acquired Mumbai based online payments startup Qfix Infocomm earlier this year and Malaysian payments platform Fave last year. The company made a significant majority investment in SaaS enterprise Mosambee in April.