Razorpay - Facilitating the SME's with effortless online payment mechanisms!

Vidhi Punamiya Vidhi Punamiya
Oct 12, 2020 8 min read
Razorpay - Facilitating the SME's with effortless online payment mechanisms!

When smartphones and the internet took the world by surprise, it opened multiple opportunities for different sectors to pioneer the evolution of a more contemporary world. One of these sectors was the online payment industry. In the same field, with the vision to revolutionize the online payment mechanisms by providing transparent and developer-friendly APIs with hassle-free user integration, Razorpay was launched by Shashank Kumar and Harshil Mathur in the year 2014.

Razorpay is an Online Payment Solution in India allowing businesses to accept, process and disburse payments with its product suite. It gives these business entities to access all the modern payment modes like credit and debit cards, net banking, UPI and popular wallets in the country namely JioMoney, Mobikwik, Airtel Money, FreeCharge, Ola Money and PayZapp. Razorpay online payment solutions can be integrated by both web and mobile applications.

As per the Razorpay Team, the Indian fintech market will touch Rs 6.2 lakh crore by 2025. It also added that COVID-19 has accelerated the company's digital payments segment.

Razorpay - Company Highlights

Company Name Razorpay
Headquarter Bangalore
Sector Fintech
Founders Shashank Kumar,Harshil Mathur
Founded 2014
Website razorpay.com

News: Razorpay turns Unicorn amidst Pandemic
Razorpay - About and How it works
Razorpay - Founders and Team
Razorpay - How did it start?
Razorpay - Business Model and Revenue Model
Razorpay - Competitors
Razorpay - Funding and Investors
Razorpay - Logo
Razorpay - Growth
Razorpay - Awards and Recognition
Razorpay - Future Plans

News: Razorpay turns Unicorn amidst Pandemic

Recent Funding on October 2020, led by Sequoia Capital India, GIC, and existing investors for $100 Million has given Razorpay "Unicorn" Status amidst the coronavirus pandemic.

Razorpay - Unicorn Status
"We at Razorpay have always been a payments company, and our focus has always been financial solutions. With this funding we want to go further in our reach. We aim to build deeper tech products and solutions, as we always have done" - Says Harshil Mathur, Co-Founder & CEO, Razorpay

Razorpay - About and How it works

As mentioned earlier, Razorpay enables online payments by providing developer-friendly APIs and an effective integration process. Razorpay also offers a comprehensive dashboard to manage payments, as well as other plugins and integration suites for all major backend technologies and e-commerce platforms.

In September 2017, Razorpay launched four products - Route, Smart Collect, Subscriptions, and Invoices, which allow businesses to manage multiple aspects of money movement including collection, reconciliation, and disbursal.

During the same time, Razorpay also announced that it was entering the SME lending space with its subsidiary venture called the Razorpay Capital. It is a lending platform that is designed to support Small and Medium Enterprises with instant and easy access to the lenders. This initiative is aimed at solving liquidity and cash-flow challenges by providing these firms with quick settlements and collateral-free loans. A beta version of the platform was launched in September 2018 and has already disbursed $30 million in loans and hopes to finish with an exit run rate of $100 million in March 2018.

Also, Razorpay added two new features in its services offered. These are respectively called ‘Partial payments’ and ‘Batch Uploads’.

  • Partial Payments- allows the end-users to make payments in part against a particular order ID instead of making the entire payment at once
  • Batch Uploads- lets the business entities generate and process links in bulk rather than creating individual links by uploading a single file containing collect order details.

Razorpay X (Comprehensive Banking Platform) is an AI-driven API banking platform, this product is set to fundamentally transform how businesses move money. The account number provided enables businesses to manage all forms of pay-outs (salary, vendor payments through NEFT, RTGS, IMPS, UPI) and receivables on Razorpay itself. A unique solution, businesses can now do everything and more with Razorpay that they were existentially doing with banks till now. Lately, there has been a significant enhancement to the existing online payment mechanism, Razorpay has also launched more new features to its checkout. These are essentially called Affordability, Personalisation and Native OTP.

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Razorpay - Founders and Team

Razorpay is co-founded by  IIT Roorkee alumni Shashank Kumar and Harshil Mathur.

Shashank Kumar and Harshil Mathur - Founder Razorpay

This initiative was originated in Jaipur as a part of the winter batch of Y Combinator's startup program in 2015. Both these co-founders quit their respective jobs at Their start-up was incubated at Start-up Oasis in Jaipur, set up jointly by the Rajasthan Industrial Investment Corporation (RIICO) and IIM Ahmedabad’s Centre for Innovation Incubation and Entrepreneurship (CIIE).

Razorpay - How did it start?

This startup idea originated when the co-founders were working on the crowdfunding portal and in the process came to realize how muddled the online payment mechanism was in India. Following this, they changed tracks to work on this problem. “We realized that most online payment gateway solutions were extremely cumbersome to get started on, especially for start-ups and small- and medium-sized enterprises. When we contacted a few payment gateway companies, we were asked for our past operational records, presence of physical offices, security deposits, and very high set-up fees. Online reviews of most payment gateways in India confirmed similar bad experiences,” Said Mathur.

This, in turn, prompted them to build a start-up-friendly online payment gateway which was easy to integrate and use. After conducting some market surveys in the initial stages to verify the feasibility of the idea and then accumulating a positive response from potential customers, the co-founders decided on starting to work full-time on the Razorpay idea.

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Razorpay - Business Model and Revenue Model

Razorpay charges 0.25 to 0.5 percent fees on every subscription collection transaction made through their gateway. However, the Razorpay 2.0 product suite contributes about 30% of Razorpay’s total revenue generation. This online payment portal is now looking to increase its average product adoption from one to two. The team expects RazorpayX and Razorpay Capital to contribute close to 35 percent of the company's revenue.

Razorpay - Competitors

The online payments market is fairly crowded when it comes to ventures operating in the sector. In the market scenario like this, Razorpay competes with both well-established and new entities like InstaMojo, PayuMoney, Oxigen, Tapzo and Citrus to name a few.

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Razorpay - Funding and Investors

Razorpay has raised a Total funding of $206.5 Million till date. (2020)

Recent Funding on October 2020, led by Sequoia Capital India, GIC, and existing investors for $100 Million has given Razorpay an "Unicorn" Status amidst the coronavirus pandemic

Funding Details of Razorpay are as follows:

Date Series Amount Investors
2015 Seed $2.5M Y Combinator, Kunal Bahl & Rohit Bansal, Punit Soni, Amit Gupta & Naveen Tewari, Kunal Shah & Sandeep Tandon
2015 Series A $9M Tiger Global
July 2016 - Undisclosed MasterCard
January 2018 Series B $20M Tiger Global, Y Combinator
June 2019 Series C $75M Ribbit Capital, Sequoia Capital
October 2020 Series D $100M GIC, Sequoia Capital
Razorpay Logo

Razorpay - Growth

  • Recorded exponential growth rate since inception
  • Currently powers more than 170,000 small & large businesses
  • Razorpay clients include Aditya Birla Capital, NSE, and Vogue India to name a few
  • Recording a healthy growth rate of 15% to 20% month-on-month
  • Merchant count geared up to 3,00,000 in 2019
  • Claims to be growing at 30% to 35% month on month

The full-stack financial solutions company witnessed a 500% growth in 2019. Razorpay powers payments for over five million businesses, including the likes of Airtel, BookMyShow, Facebook, Ola, Zomato, Swiggy and Cred among others and is all set to double this to 10 million by the end of this year(2020)

Best Indian Payment Gateways in 2020 | Payment Gateways for Business
A payment gateway is a merchant service that connects the users’ bank accountwith the platform where the users need to transfer their money. A bank mayprovide payment gateway to its customers, there is also a specialized financialservice provider such as payment service provider which provides pa…

Razorpay - Awards and Recognition

The various awards and recognitions received by Razorpay overall these years include:

  • 2018 - Recognised as one of India's Top 50 Mid-Sized Workplaces in the category of “Great Places to Work.”
  • 2018 - Awarded by IAMAI as the “Best Digital Payment Facilitator.”
  • 2018 - Awarded by LinkedIn as India’s 25 Most Sought-after Companies to Work for.
  • 2017 - Was a runner up for the “Financial Express Software Product of the Year.”
  • 2017 - The co-founders Shashank Kumar and Harshil Mathur got selected for the 'Forbes 30 Under 30'.
  • 2017 - Backed the Bronze Award for the Best POS Innovation by PYMNTS.com.
  • 2016 - Made it in the Nasscom 'League of 10' Companies.

Best Indian Payment Gateways in 2020 | Payment Gateways for Business
A payment gateway is a merchant service that connects the users’ bank accountwith the platform where the users need to transfer their money. A bank mayprovide payment gateway to its customers, there is also a specialized financialservice provider such as payment service provider which provides pa…

Razorpay - Future Plans

Recently, Razorpay is focused on capturing the Indian market. As per their future plans, the company aims to enter the South East Asian markets too. The team will be looking at acquiring and investing in Fintech B2B SaaS space.

"Our technology is replicable across other emerging markets too which face similar issues." Said Harshil.

With its recent funding on October 2020, Razorpay hopes to further grow its product lines - the neobanking platform Razorpay, and its lending arm - Razorpay Capital (an initiative to empower SMEs). It'll also look for hiring additional 500 employees by FY’21.

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