IPO-bound Pine Labs acquires fintech interface startup for $75 million

“Embedded financial services and open banking are going to be the way forward and the embedded finance market value is expected to exceed $138 billiob by 2026 as APIs are intensifying the competitive fintech landscape," said Amrish Rau, CEO, Pine Labs.

"Setu helps its customers, merchants, and brands build beautiful experiences, so consumers can engage with payments and financial services on their terms. We are in the golden phase of digitisation in India, and Setu is a pioneer in supporting innovation on the India stack — their work on UPI and in the account aggregator space," he added.

Rau further called Setu "a team of builders and entrepreneurs", and "together with the Pine Labs team, will tackle hard problems to solve in the ecosystem.”

This is the third acquisition for Pine Labs in 2022, which picked up a majority stake in payments solution provider Mosambee in April and Mumbai-based online payments startup Qfix in February.

The deal comes at a time when Pine Labs is expanding its offerings beyond merchant payments. It is expanding its Buy Now Pay Later (BNPL) offering in Southeast Asia and entered the consumer payments space with the acquisition of Fave in April 2021.

“Pine Labs’ network of merchants and issuers coupled with our API integration prowess will help achieve great results in personal finance management, monitoring loans to predict default rates, credit underwriting, and several other areas,” said Sahil Kini, Co-founder and CEO, Setu.

Backed by Sequoia India and Mastercard, Pine Labs is said to have confidentially filed for a US listing, seeking to raise about $500 million, as per a Bloomberg report.