Indian fintech startup Cashfree Payments acquired Zecpe to improve shopping experiences
Cashfree Payments, an online payment platform, has acquired Zecpe, for an undisclosed amount. With Zecpe’s technology, online businesses can improve their payment conversion rates by simplifying the payment process for customers. In a press release on 28 February 2023, Cashfree Payments announced that Zecpe would operate as a wholly owned subsidiary, offering the same services to e-commerce businesses. This acquisition has resulted in an improvement in Cashfree Payments’ ability to offer one-click payment options to its customers.
Although Cashfree has not disclosed the finances involved in the deal, sources indicate that the acquisition could have valued Zecpe at approximately $10 to $12 million.
Cashfree, backed by SBI, reportedly laid off about 13% of its workforce, or about 80 employees, last month. However, the fintech company claims it only reduced 6-8% of its employee base as part of its downsizing plan.
Cashfree Payments has appointed Hriday Agarwal, the founder of Zecpe, as head of the e-commerce cashier as part of the acquisition deal. Furthermore, the employees of Zecpe will also join Cashfree Payments to help scale the product.
Cashfree Payments CEO and co-founder Akash Sinha expressed his excitement about acquiring Zecpe, saying the two companies’ products complement each other well. He believes this will be a great addition to Cashfree’s D2C Payments Suite and enhance their one-click payment capabilities, further cementing their position as leaders in the SMB space.
Shopflo, an e-commerce facilitation company, received seed funding from Tiger Global last year to tap into the burgeoning market.
Meanwhile, Cashfree has stated that the Zecpe acquisition will enhance its D2C checkout capabilities and provide merchants with an improved end-to-end checkout and payment experience.
As a result of the acquisition of Zecpe, Cashfree Payments is likely to expand its range of value-added services, including return-to-origin (RTO) reduction, fraud detection and address pre-filling. This is because Zecpe’s one-click checkout platform is designed to improve the customer experience during the checkout process, which can reduce RTO rates and the potential for fraud detection. In addition, the platform can automatically fill in a customer’s address information, making the payment process more seamless.
Sinha added that the solution provided by Zecpe is in line with Cashfree Payments’ product strategy. The strategy of Cashfree Payments is to prioritize the benefits of the end customers of its merchants.
Cashfree is an Indian payment gateway established in 2015 by Sinha and Reeju Datta. The company facilitates online payments and disbursements for businesses in India. In 2021, the firm received strategic funding from the country’s largest lender, State Bank of India (SBI), at a post-money valuation of $200 million.
Agarwal said India’s Direct-to-Consumer (D2C) space is expanding rapidly. Therefore, it is an excellent opportunity to help e-commerce businesses increase conversion rates and minimize fraud and returns on delivery (COD). He added that they have extensive knowledge in this area because they work with a large network of well-known brands.
Cashfree Payments claims it has over 300,000 merchants using its services to collect payments and make payouts through all available methods.
As part of its plan to expand its presence in the Middle East North Africa (MENA) region, the company had previously acquired Telr, a prominent payment service provider in the UAE and Saudi Arabia.
The acquisition of Zecpe by Cashfree Payments has significantly improved its one-click payment capabilities and improved the overall customer experience. By simplifying the payment process for e-commerce businesses, Cashfree Payments can help its customers improve payment conversion rates and minimize fraud and returns. This move is likely to strengthen Cashfree Payments’ position in the market and help it compete more effectively with other players in the area. This acquisition is a strategic move by Cashfree Payments to expand the product offering and provide more value to customers.
