Indian unicorn Pine Labs buys fintech firm in up to $75m deal

India-based merchant platform Pine Labs has acquired fintech infrastructure provider Setu in a cash-and-stock deal worth between US$70 million and US$75 million.

Photo credit: Pine Labs

The deal will help Pine Labs foray into embedded finance and gain access to Setu’s API infrastructure to provide additional services for its online merchant partners. Setu is the Indian unicorn’s third acquisition of the year.

Pine Labs offers payment services for merchants’ in-store and online channels. It also has 80 business utility apps where merchants can manage their in-store operations, including invoicing, inventory management, and GST compliance (the Indian government’s rating assessment against businesses based on their tax records).

Meanwhile, Setu is an account aggregator that lets users securely share their financial data with banks and other financial institutions.

See also: Fave’s investors are getting all their money back, says CEO

“We think that in the next three to five years, over half a billion people will make their first digital payment and new platforms like UPI, Aadhaar, DigiLocker, Account Aggregator, OCEN, and ONDC will significantly lower the transactional and onboarding costs,” Setu founders Sahil Kini and Nikhil Kumar said in a statement.

In April, Pine Labs made a “significant majority investment” into Mosambee, an end-to-end payment solution provider based in India. As of March, Pine Labs had over 250,000 merchant partners across more than 675,000 network touchpoints in India and Southeast Asia.