ZestMoney’s failed buyout is the last nail in BNPL coffin
The concerns flagged by PhonePe owner Walmart for not going ahead with the acquisition are emblematic of all that’s wrong with the buy now pay later business in India.
Why read this story?
Editor's note: ZestMoney’s distress sale to PhonePe is off, The Economic Times reported last week. The reason: PhonePe’s owner, Walmart, decided against the deal after the Bengaluru-based buy now pay later startup failed to pass its due diligence test. This undoubtedly puts ZestMoney, one of the pioneers of India’s online buy now pay later industry, in serious trouble. According to media reports, the company is now preparing for layoffs across departments as it is on the verge of running out of funds with no other prospective buyer in sight. The unravelling of ZestMoney’s operations over the last year and its subsequent failure to close a deal with PhonePe, in my opinion, marks the final nail in the coffin of BNPL in India. Before I elaborate on this, let’s take a quick look at the circumstances in which the high-profile deal between the two well-known fintech startups collapsed. Several industry executives tell me ZestMoney started talks with PhonePe for an acquisition in November. It was a distress sale that was prompted largely on the back of two major events: The near collapse of …
More in Internet
You may also like
CSB Bank’s deposits are a ticking time bomb
The Kerala-based bank has been chasing costly and risky bulk term deposits amid tanking profitability.
Yes Bank’s succession problem is a board problem
As Prashant Kumar’s term runs out, boardroom fault lines have left the lender with no clarity on its next CEO—spooking investors and drawing the RBI’s ire.
PhonePe’s transition from payments to a financial services company is incomplete
The company’s IPO plans come amid weak numbers, slow growth of new platforms, challenges in its core payments business and a rather dull stock market.