Fintech company Razorpay has acquired TERA Finlabs, a Bengaluru-based startup that offers technology, risk and equity solutions to companies, for an undisclosed amount. TERA Finlabs, the Indian subsidiary of UK digital lender GAIN Credit, launched in 2018 to expand its global presence in digital lending.

Razorpay said in a statement that the acquisition of TERA Finlabs is aligned with its strategy of financially supporting MSMEs by building competencies in capital solutions, credit underwriting and data-driven risk management.

It is Razorpay’s third acquisition in nearly three years and continues its foray into the Business to Business (B2B) SME lending space with the launch of Razorpay Capital in 2019. Razorpay Capital offers business loans and instant settlements to meet liquidity challenges and SME cash flow.

In 2018, Razorpay acquired Thirdwatch (an AI-powered company that helps reduce return-to-origin (RTO) fraud losses in e-commerce) in 2018 and Opfin (a payroll management software company) in 2019. Razorpay has reported 40 -45% growth, month over month.

The company has achieved $ 40 billion of POS (total payment volume) and aims to further consolidate its position as one of the largest full-stack fintech companies in India.Razorpay currently drives payments of more than eight millions of companies, including companies like Facebook, Airtel, Ola, Zomato. , Swiggy, Cred, ICICI Prudential, among others, and it is all set to reach 200 million customers in 2021.

Harshil Mathur, CEO and co-founder of Razorpay, said Indian banks are wary of making business loans to startups and small businesses. Razorpay aims to solve these cash flow challenges. “The TERA FinLabs team has exceptional domain knowledge in credit underwriting and risk management, and we see immense value in TERA Finlabs.”

Small businesses have struggled to organize short-term funds to cover expenses, as their lenders have responded cautiously. To take advantage of that demand, Razorpay has products that provide instant settlements and solve cash flow problems.

Pradeep Rathnam, CEO and co-founder of TERA Finlabs, said that MSMEs were an underserved market. “There could not have been a better time than now to join Razorpay and its technological capabilities to support the MSME segment,” said Rathnam.