Kiwi, a fintech startup based in India, has raised US$24 million in a funding round led by Singapore’s Vertex Ventures Southeast Asia and India.

Nexus Venture Partners, Omidyar Network, and Stellaris Venture Partners also took part in the round.

Kiwi plans to use the new funding to launch credit lines on the Unified Payments Interface (UPI) within six months, following regulatory approval from the Reserve Bank of India in September 2023.

The company currently issues RuPay credit cards in partnership with Yes Bank and AU Small Finance Bank, allowing payments through UPI.

Kiwi said it has issued 200,000 RuPay credit cards since its 2023 launch and processes over 5 million merchant transactions monthly across 600 Indian cities.

The move comes as banks and fintechs ramp up efforts to build credit products linked to UPI, a system that now handles around 19 billion monthly transactions in India.

🔗 Source: The Economic Times

🧠 Food for thought

1️⃣ Regulatory clarity accelerates targeted fintech investment in India

Kiwi’s $24 million funding round demonstrates how regulatory approval directly drives venture capital into specific fintech products.

The company raised funds specifically to launch credit lines on UPI within six months after the Reserve Bank of India approved this product category in September 20231.

This regulatory milestone created immediate investment opportunities, as evidenced by Scapia raising $40 million in April 2024 for similar UPI credit integration1.

The RBI’s introduction of pre-sanctioned credit lines on UPI allows users to access credit directly through UPI apps without physical cards, fundamentally changing how Indians can access short-term credit2.

This reflects India’s broader fintech landscape where regulatory frameworks have historically enabled rapid scaling, similar to how UPI itself transformed digital payments and now processes 19 billion monthly transactions1.

2️⃣ UPI credit represents a massive untapped market despite early traction

The gap between UPI transaction volume and credit card adoption reveals enormous growth potential for companies like Kiwi.