Kiwi Secures $24 Million To Broaden UPI-Linked Credit Options
Bengaluru-based fintech company Kiwi has raised $24 million in its latest funding round, reflecting increasing investor confidence in India’s rapidly evolving digital payments ecosystem. The round was led by Vertex Ventures Southeast Asia and India, while existing investors Nexus Venture Partners, Stellaris Venture Partners and Omidyar Network continued to participate. With this infusion, Kiwi’s total funding has climbed to $43 million across three equity rounds.
Strengthening UPI-Credit Integration
The fresh capital will primarily fuel Kiwi’s next big initiative—credit lines on the Unified Payments Interface (UPI). Since September 2023, when the Reserve Bank of India (RBI) authorized linking credit products to UPI, the company has been working on this feature. Kiwi expects to launch within the next 6 months and will be amongst the first fintech players to take advantage of this newly opened avenue.
This product will enable users to use the pre-approved credit limits through their UPI savings accounts – which removes the need for a credit card system. Essentially, Kiwi is trying to use UPI, already the most prevalent digital payments platform in India, to access credit easily. This could fundamentally alter the way Indian consumers borrow, and spend.
Early Success With RuPay Credit Cards
Founded in 2022 by ex-bankers Anup Agarwal, Siddharth Mehta, and Mohit Bedi, Kiwi launched by issuing RuPay credit cards in collaboration with Yes Bank and AU Small Finance Bank. Unlike typical credit cards, Kiwi’s product has an uncharacteristic integration that provides an edge—cards are linked directly to UPI. This enables consumers to pay merchants through UPI using credit, essentially combining the acceptance of UPI with the functionality of card-based lending.
Since its commercial launch in 2023, Kiwi has witnessed rapid adoption. The startup has already issued over 200,000 RuPay credit cards, and today it processes more than five million merchant transactions every month across 600 Indian cities. This strong early traction highlights the growing appetite for credit-backed UPI payments among Indian consumers.
Expanding Partnerships And Product Roadmap
Kiwi is not stopping at just credit card issuance. The fintech is actively in discussions with multiple banks to expand its partnerships and strengthen its product suite. Alongside the upcoming UPI-linked credit lines, Kiwi is also building add-on features for credit cards, equated monthly installment (EMI) options on UPI transactions, and other consumer-friendly services.
The company has set a daring goal over the medium term, to reach one million RuPay credit cards by 2027, and become one of the largest players in UPI-credit.
Riding the Digital Payments Wave in India
Kiwi’s growth story comes at the same time as a wider orientational change in India’s fintech ecosystem. The Unified Payments Interface (UPI) is swiftly becoming the backbone of all digital payments in India, facilitating almost 19 billion transactions and reaching over 350 million unique users a month, more than once the entire number of the existing credit card ecosystem in India which is relatively small.
As far as the policy orientation of the Reserve Bank of India (RBI), it is seen as a landmark shift that is monumental, allowing credit to be leveraged the same way as UPI has been given its scale. Kiwi and other like-minded startups will be able to offer credit products with more acceptance than a bank credit card, at a lower cost to operate and a faster time to scale.
Investor Confidence And Outlook
Kiwi provides investors with an exciting opportunity at the intersection of digital payments and consumer credit. The investment in Kiwi from both global and domestic VCs validates the company’s model for capturing a piece of the pie in one of the fastest growing fintech ecosystems in the world.
Commenting on the funding, investors in the sector feel that Kiwi’s emphasis on financial inclusion, product innovation around UPI and strategic partnerships with banks, provided Kiwi an advantage in a crowded market. If executed effectively, Kiwi could be a key player in driving the next wave of credit adoption in India.
As consumer demand for flexible, digital form of organized credit continues to rise, Kiwi’s experience and variety of banking partnerships, its integration with UPI, and agility as a fintech company, may help set the stage for how credit products are built and scaled in India in the years to come.
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