Bangalore-based mobile payment solutions provider iKaaz Software Pvt Ltd is in advanced stages of talks to raise $8-10 million in its Series A round of funding from ad-for-equity media investor Bennett, Coleman and Co. Ltd, which picks stakes in firms through Brand Capital, among other investors, sources privy to the development told Techcircle.in/VCCircle.
The capital will be used for expansion in India a new product launch. This product will expand iKaaz’s service platform from being B2B to B2C in the country. So far the company has been selling its platform to banks and institutions. Post this it will target consumers directly.
The round is expected to close by the year-end.
When contacted, Soma Sundaram, chief executive officer and founder of iKaaz, declined to comment on the investors or the amount but said the company is almost ready with its new product which will facilitate inter-operability. “We will be releasing the product early next year and will have the pilot in Bangalore in a couple of weeks,” Sundaram said.
“There are so many wallet players out there but when it comes to merchant acceptance and inter-operability, it’s a huge challenge. We will launch an innovative product which addresses these concerns,” he added without giving more details.
IKaaz had raised an undisclosed amount in its seed funding round early this year from Ananda Kallugadde, managing director of NeoBytes Software Solutions, among others.
At that time the company’s chief had told Techcircle.in that it is eyeing around $5 million its Series A round.
A separate email query sent to Brand Capital spokesperson did not immediately elicit a response.
The company, which currently has 25 employees based out of its Bangalore office, also plans to go on a massive hiring spree. “We plan to hire around 200 people during the same period (by early 2015),” said Sundaram.
Currently, the firm claims it is clocking 0.25 million transactions per month and has over 5,000 merchants with the average size of the transaction being Rs 65.
iKaaz was founded by Sundaram, who has two decades of experience in the software industry particularly in payments, social networking and open source domains. Earlier, he held a senior management position at Nokia’s global mobile money division. Prior to that, he was VP (product engineering) at Obopay.
iKaaz refers to digital money and is a name derived from Tamil word Kaas (money). It offers a mobile payments platform to enterprises, business correspondents and merchants in developed and emerging markets.
Besides Karnataka, it has presence in Maharashtra, Andhra Pradesh and Kerala in India. It has also expanded to Africa with presence in Kenya and Nigeria.
It provides a Near Field Communication (NFC) tag (which costs less than $2) that can be installed in any feature phone, turning it into a PoS facilitator.
Also, a customer can link the iKaaz NFC tag to his/her bank account, pre-paid account, debit or credit card, and once that is done, the device acts as an extension of the account.
The firm recently launched an NFC-enabled reader for merchants/enterprises to use as a mobile PoS.
Other players in the mobile payments space in India include mobile PoS solutions provider Mswipe, Bangalore-based Ezetap and Delhi-based Cobboc Pvt Ltd, which offers a mobile-based payments app Eashmart.
(Edited by Joby Puthuparampil Johnson)