Zeta, a banking technology provider, has raised $50 million in a strategic investment round, propelling its valuation to $2 billion, the company announced. This marks a substantial leap from its previous pre-money valuation of $1.15 billion, set during its $250 million fundraising from SoftBank Vision Fund 2 and other investors in 2021.
The latest funding round was led by American healthcare giant Optum, highlighting the increasing investor interest in the banking technology sector. Zeta plans to utilise the funds for global expansion and product development.
Bhavin Turakhia, Co-Founder and CEO, Zeta, expressed enthusiasm over the company’s rapid growth. He stated, “We are incredibly excited at the pace at which clients are embracing our modern stack. Our clients are breaking away from decades of legacy systems to deliver amazing digital experiences, increasing customer satisfaction and accelerating new user acquisition.”
Founded in 2015 by Bhavin Turakhia and Ramki Gaddipati, Zeta provides cloud-native, SaaS-based banking solutions, enabling banks and fintech companies to launch credit cards, checking and savings accounts, unsecured loans, and payment products.
Zeta’s Growth Trajectory and Market Impact
- Zeta has over 25 million accounts on its Tachyon cloud-native processing platform, with another 25 million in the pipeline through existing contracts.
- The company has partnered with HDFC Bank, launching Pixel, a digital-native credit card programme, as well as Pluxee and Sparrow Financial, a card issuer for non-prime cardholders in the US.
- Since October, Zeta has been processing 2 million transactions daily, with its credit-on-UPI stack, launched in May, positioning the company to capture 50% of the credit-on-UPI market.
Zeta has raised a total of $340 million from investors, including SoftBank and Mastercard. The company’s pay-per-use revenue model has fueled rapid growth, with its parent company Better World Technologies posting a 5.4x surge in profit after tax to Rs 119.82 crore in FY24, alongside a 9.42 per cent revenue increase to Rs 893.12 crore.
Zeta’s latest funding round underscores the booming investor confidence in fintech infrastructure. Five months ago, API infrastructure firm M2P Fintech raised Rs 850 crore ($102 million), led by Helios Investment Partners. Meanwhile, Juspay is in advanced talks to secure $150 million from Kedaara Capital, WestBridge and SoftBank.
With its strong technological foundation and ambitious growth plans, Zeta is poised to redefine the future of digital banking and financial services.
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