India gets its 100th unicorn: Neobank Open attains $1 billion valuation

New Delhi: The number of unicorns in the Indian startup ecosystem surpassed 100 on Monday, when Bengaluru-based neobank platform Open raised $1 billion in its Series D round of funding.

According to a statement from the company, the fresh round was led by Mumbai-based investment firm IIFL, with current investors Tiger Global, Temasek, and 3one4 Capital also participating.

"We see a lot of synergies with IIFL, especially on leveraging the lending book," said Anish Achuthan, co-founder and CEO of Open. "We're getting ready to launch innovative products like revenue-based financing, early settlement, working capital loan, and business credit cards to SMEs on our platform," he added.

More than 20 lakh firms in the country use the neobank platform, which conducts over $30 billion in transactions each year.

The advent of neobanks, according to Bengaluru-based management consulting firm Redseer, is expected to upset India's $31 billion fintech business.

Neobanks are bridging the gap between traditional banks' services and clients' changing expectations in the digital age.

Open, which has raised $187 million to date, plans to launch three additional products, including revenue-based financing Flo, early settlement card providing Settl, and working capital loan Capital, in the near future.

With its new solutions, the neobank platform firm hopes to disburse $1 billion.

With the development of neobanks, India's fintech market, which is the world's third largest behind the United States and China, is ready for additional disruption.

According to data from Venture Intelligence, Indian companies raised more than $10 billion in the first quarter of 2022, up from $5.7 billion in the same time of 2021.

During the first quarter of this year, 14 startups became unicorns.