11 Dec 2023
The startup began operations in September 2015. Its valuation reached $440 million in June 2022 but nosedived to $8 million in July 2023.
On December 5th, fintech startup ZestMoney announced the closure of operations and lending activities by the end of the month. The company had secured $134 million in equity funding, a $440 million valuation in June 2022, and $4 million in emergency funding this year.
ZestMoney founders quit the company earlier this financial year, followed by the announcement of 100 job cuts. Unjustifiable valuation ruined its $300 million merger plans with PhonePe. Moreover, funding slowdown, poor loan recoveries, and increasing Non-Performing Assets added to their financial woes. The new management, who joined in May, could not stop the downward spiral.
ZestMoney had 17 million registered users and more than 10,000 online merchants. It had over 20 partnerships with financial institutions, of which most were suspended by August 2023. Its investors included Goldman Sachs, PayU, Naspers, and Omidyar. It used AI to underwrite eCommerce consumer loans and provide EMIs to online shoppers.