Industry veteran Jitendra Gupta’s consumer-focused neobank Jupiter has raised about $86 million in a new round of funding as the Bangalore-based startup gears up to offer its clients credit and wealth management services.
Tiger Global, QED and Sequoia Capital India together led the Series C round of the two-year-old startup, Gupta told BestFitnessBands in an interview. The new round values the startup at $711 million, up from about $300 million in August’s Series B funding.
MUFG Bank, Japan’s largest bank, also invested in the new round, debuting fintech backing in the South Asian market. Existing investors 3one4 Capital and Mirae Asset also joined the round.
Launched in beta in June this year, Jupiter has established itself as a market-leading “100% digital bank” in India. The startup has “garnered only half a million users,” Gupta said. More than 65% of this user base actively trades on the platform every month, he said.
“We more than double the transaction volume every month. We should end up with more than $60 million in transactions this month,” said Gupta, who previously co-founded CitrusPay, a fintech startup acquired by PayU.
Numerous startups in India today are trying to improve the banking experience in India. Whether you are a teen, a recent graduate, a working professional, or have no credit score, there are companies that can give you a credit card and loan. But most of these services have a certain limit.
The fintech veteran is taking a broader approach to customer acquisition by adding what he says is “delight” to the banking experience. And that bet seems to be working. Jupiter, which offers its customers both a bank account and a debit card, adds about 5,000 users every day and uses less than $1 million a month.
Reducing the friction customers face when interacting with their banks and an extra layer of supply have helped neobanks penetrate several markets in recent years. The top 20 neobanks worldwide have about 180 million customers, analysts at Jefferies wrote in a note earlier this month. This figure “may seem small overall, but the number is growing rapidly,” they wrote.
Gupta said the startup now has more than $145 million in its bank. It has yet to put in capital it raised from the previous round — which eventually rose to $50 million. In addition, it has yet to use nearly half of the $25 million fund it raised in its Series A round two years ago.
He said Jupiter, which employs about 300 people, is focused on developing new services for its customers. By April, the startup plans to offer its customers a lending feature. It will also launch investment products next year.
“We have enough capital to use. We are confident that we will reach at least 2 million users by the end of next year,” he said.