B2B-focused fintech startup Vegapay raises $5.5M led by Elevation Capital, Eximius Ventures

Vegapay, a business-to-business (B2B) focused fintech startup that provides digital lending and card management solutions, has raised $5.5 million in an equity funding round.

The round was led by Elevation Capital, with participation from existing investor Eximius Ventures.

Prior to this, the startup had raised $1.1 million in funding in 2023, led by Eximius Ventures.

What does Vegapay do?

Founded in 2022 by Gaurav Mittal, Himanshu Agrawal, Puneet Sharma, and Abhinav Garg, Vegapay helps financial institutions such as banks and NBFCs (Non-Banking Financial Companies) launch and manage their own flexible and customizable credit programs.

The startup offers a platform that automates solutions like card management systems, Unified Payments Interface (UPI) on credit lines, and other credit-based programs like origination systems and loan collection systems.

Focusing on enhancing the product suite

The startup plans to use the raised capital to enhance its product suite, with a strong focus on product development and regulatory compliance.

A significant portion of the funds will be allocated to hiring top-tier software developers, designers, and engineers to drive innovation within the company.

The funding aims to help financial institutions streamline their processes and reduce the time required for implementing new credit solutions from months to just a few days.

Expanding footprint globally 

Vegapay plans to expand its footprint globally, targeting regions such as Southeast Asia and the Middle East.

The startup projects reaching an annual recurring revenue (ARR) of $2 million by December of next year and aim to become cash flow positive. Additionally, Vegapay intends to have over 1 million cards in force by the end of the next year.

It is also working with over six banks, including a major public sector bank to launch a credit card next month and introducing a credit line on UPI solution with another private sector bank.

Leadership comments

Gaurav Mittal, co-founder and CEO of Vegapay, emphasized the startup's mission to address the core challenges banks face in offering credit cards and other credit products.

"In the credit card space, there are legacy companies, but most of the banks are not liking it for obvious reasons, and therefore new-age players like us are solving the core pain for a bank to offer credit cards or any credit products," Mittal said.

Vaas Bhaskar, Principal at Elevation Capital, highlighted the accelerating demand for modern credit platforms among financial institutions. “Financial institutions' demand for modern credit platforms is accelerating at an unprecedented scale… These modern systems will form the foundation of all innovations by banks and credit providers. We see great potential in Vegapay's solutions to fill this void,” Bhaskar stated.