Pine Labs Acquires API Infrastructure Provider Setu for for $70 million

Pine Labs has acquired Setu, a Bengaluru-based fintech infrastructure provider, to expand its portfolio of services.

Pine Labs, which is planning an IPO, has acquired Setu, a Bengaluru-based fintech infrastructure provider, to expand its portfolio of services. Pine Labs has acquired a 100 percent share in Setu in a deal valued at between $70 million and $75 million.

In this photo illustration, a Pine Labs logo is seen on a smartphone
Image Courtesy: Pavlo Gonchar

Setu's brand identity, business, teams, and customers would be upheld following the acquisition, according to Setu CEO and cofounder Sahil Kini. Furthermore, the founders will continue to make strategic decisions.

Setu, founded in 2018 by Kini and Nikhil Kumar, is an API infrastructure provider that provides services in bill payments, credit, savings, and payments. “With the partnership, Pine Labs has in the financial services ecosystem, we look forward to leveraging all of these assets we get along with and continue to build,” Kumar said at a media briefing.

Pine Labs' CEO Amrish Rau stated that the company's product offering is still growing. The company began as a Point of Sales (PoS) provider and gradually expanded its offering to accommodate instalment payment transactions at the point of purchase. Pine Labs, unlike most fintech players, did not begin its journey in the last decade. Lokvir Kapoor founded it in 1998. The fintech startup joined the unicorn club in 2020, some two decades after its founding.

Pine Labs introduced Plural, a payment solution for merchants, last year. Plural has already processed Rs 2,000 crores in payments since its inception, according to Rau. Payments are becoming more integrated with time, according to Rau, adding that transactions are now taking place on Instagram and YouTube. “Payments have become more embedded and frictionless in our day-to-day journey,” he noted. Setu comes into play here since it has been working on integrated finance.

Pine Labs has made its third acquisition this year with Setu. It invested in Mosambee, an end-to-end payment solutions company, in April. Previously, it bought Mumbai-based online payments firm Qfix Infocomm. In March of this year, the fintech startup reportedly raised $50 million in a funding round led by private equity firm Vitruvian Partners. In February, it also received a $150 million in funding from Alpha Wave Ventures. Pine Labs, for instance, is preparing to go public on the NASDAQ this year.