The DMI Group has acquired beleaguered fintech ZestMoney in a fire sale after the latter failed to secure funding.
"DMI Finance, the NBFC arm of DMI, will be a preferred lender on the Zest platform. Through this acquisition, DMI will have the exclusive right to the use of all Zest brands," the group said in a statement. The terms of the deal remained undisclosed.
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, it added. "DMI will also bring its customer base, balance sheet strength and significant risk-management experience to drive growth across Zest's online and offline merchant networks."
"DMI has been at the forefront of digital lending in India. They bring 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," said Mandar Satpute, chief operating officer at Zest.
"We are always looking for best-in-class solutions to enhance both the engagement with—and the experience of—our customer and merchant base. We have been partnered with ZestMoney for over eight years in various capacities. We firmly believe that this acquisition will be an important step in our journey to provide digital financial inclusion at scale across India," Shivashish Chatterjee, co-founder and joint managing director of DMI said.
ZestMoney's troubles began last year after a failed acquisition deal with PhonePe. Its three co-founders and key executives stepped down from their daily duties at the startup shortly after talks fell through.
In December, ZestMoney, which popularised the 'buy now, pay later' product, said it would be shutting down by the end of this year. The startup's management informed employees that it would be winding up operations and that the remaining 150 employees would be let go.
Founded in Bengaluru in 2015, ZestMoney raised close to $130 million across its lifetime and accrued as many as 1.7 crore registered users, it said.
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