Bizongo Under Fresh Scrutiny as Auditors Flag Potential Financial Fraud, Board Launches Investigation

Muskaan Kapoor

26 Apr 2025 — 3 min read

Bizongo Under Fresh Scrutiny as Auditors Flag Potential Financial Fraud, Board Launches Investigation

B2B e-commerce marketplace Bizongo is under heightened scrutiny after auditors flagged concerns over financial irregularities. Once seen as a rising star in India’s startup ecosystem, Bizongo is now navigating governance challenges, leadership transitions, and creditor pressure. The company’s board has launched a fresh investigation into the matter, raising questions about corporate governance and financial controls in India's fast-growing startup ecosystem. Major investors, including Accel, Chiratae Ventures, B Capital, and the International Finance Corporation (IFC), are overseeing the developments.

Auditors Raise Red Flags

In January 2025, Bizongo’s statutory auditors, BSR & Co. LLP, flagged potential irregularities in the company’s FY24 financials, Moneycontrol reported, citing internal communications and regulatory filings. The auditor’s report pointed to questionable vendor-customer relationships, duplicate entities sharing addresses, and missing Proof of Delivery (POD) documents.

Although the auditors did not directly conclude fraud, they recommended an independent investigation to verify the authenticity of the transactions. Following this, Bizongo’s board initiated a fresh investigation to ensure all aspects of the flagged issues were thoroughly examined. The company engaged PwC to assist with the forensic review.

Link to Earlier Employee Fraud Incident

The fresh concerns reignite scrutiny around a previous fraud incident discovered in April 2024. At the time, Bizongo found that a mid-level finance employee had allegedly defrauded the company of over INR 21 crore through fictitious transactions. This was linked to Bizongo’s now-discontinued supply chain financing vertical.

Bizongo had filed a police complaint with the Economic Offences Wing (EOW), leading to an FIR against the former employee. Initially, the company maintained that the fraud was restricted to the shuttered unit. However, the latest auditor findings have raised concerns about the strength of Bizongo’s overall governance.

Leadership Changes and Business Realignment

Amid these challenges, Bizongo has undergone significant leadership restructuring. In March 2025, co-founder and CEO Sachin Agarwal stepped down and moved to a board role. Former Flipkart executive Prahalad Krishnamurthi was appointed as the new group CEO. Gaurav Singhania assumed the role of CFO, and Gulshan Kaushik became Chief Business Officer. New heads for technology and financing businesses were also brought in.

Investor-appointed board members, including representatives from Chiratae Ventures and B Capital, resigned during the governance overhaul.

In response to the turmoil, Bizongo shut down its supply chain financing vertical in September 2024 and pivoted its focus to two new business lines: BizongoBuy, catering to raw material procurement, and BizongoFin, offering financial services to SMEs.

The company claims that following these changes, it has achieved 100% compliance in its operations.

Mounting Creditor Pressure

Separately, Bizongo is facing pressure from creditors over pending dues. Although the company claims to have reduced its debt from INR 1,000 crore to around INR 100 crore, Moneycontrol reported that some lenders are exploring legal options to recover the remaining amounts.

Future Outlook

Founded in 2015, Bizongo has raised over $334 million from investors such as Accel, Tiger Global, B Capital, and Chiratae Ventures. It was last valued at $980 million in October 2023.

The company aims to complete its FY24 audit by the end of April 2025. Bizongo has stated that it is taking the necessary time to ensure all disclosures are complete and compliant, given the scale of its internal restructuring.

With governance issues affecting many Indian startups, Bizongo’s future depends on the outcome of its ongoing investigations and its ability to rebuild trust with lenders and investors.