Venture capital (VC) firm Sequoia Capital India has invested another $8 million (Rs.35.5 crore) in Prizm Payment Services Pvt. Ltd, an electronic payment service provider. Sequoia has now invested about $15 million in the company, with a $7 million funding in the first round in 2008, reported Livemint Friday.
Loney Antony, managing director, Prizm Payments, noted that Prizm, which deploys, manages and operates point of sales (PoS) networks for banks, will use the funds mainly for setting up more ATMs.
A year ago, the company used to set up three-four ATMs per day and Friday it set up around 10 ATMs per day. The target is to set up 17-18 ATMs per day in the next six months. There is a gap in the demand and supply of ATMs, according to Antony, added Antony.
The number of debit cards has grown fourfold to 200 million in the last three years and the number of transactions on each ATM in India is five times more than those done globally, said Antony. The company will also look at expanding into other areas of electronic payment gateways, he added.
VC investors are increasingly eyeing investments in electronic payment services companies. They expect the growth in e-commerce to give a boost to electronic payment gateways, said Livemint.
Alok Mittal, managing director, Canaan Partners, an early stage technology-focused VC firm, said Electronic payments are going up as regular debit card and credit card payments are on the rise.
According to Livemint, the National Payments Corporation of India will soon launch the e-payment card “Rupay” in the country—the Indian alternative to Visa and Mastercard—and this is expected to give rise to new payment technology companies.
Mittal said the company is working on a deal in the sector and should probably finalize it in a few weeks.
Mohit Bhatnagar, managing director, Sequoia Capital said Sequoia Capital is also looking for other opportunities in the sector. The company continues to look at the payment areas for investments and also for opportunities along with Prizm where it can expand by purchasing other smaller players, said Bhatnagar.
According to Livemint, in May this year, 3i Infotech sold its global billing and payments unit to private equity firm Cerberus Capital Management LP for $137 million.
Mittal noted that globally, there are a lot of mergers and acquisitions happening in the sector as bigger players look to increase their footprint.
