At a $2 billion value, Zeta, a company that supplies banking software to banks and fintech firms, has raised $50 million from a strategic investor.
When the Bengaluru-based startup raised $250 million in a round-headed by SoftBank Vision Fund 2 in 2021, it was valued at $1.15 billion (pre-money). This investment from the American healthcare company Optum represents a 70% rise in the startup’s valuation.
Zeta, which was founded in 2015 by Bhavin Turakhia and Ramki Gaddipati, assists banks in launching and managing credit cards, checking accounts, and loans by utilizing contemporary technology and cloud infrastructure.
Turakhia stated in an interview
“In banking, 60%-70% of institutions still operate on mainframes — many created before some of us were even born,”.
He likened it to the industry’s slow transition to cloud computing, in which banks first ran their own data centers before implementing AWS and Azure services.
Though the stakes are higher because it entails replacing what he refers to as “the heart and soul of the bank”—systems that handle accounts and process payments—he anticipates a similar progression in core banking technology.
Zeta claims to have 25 million accounts on its network and has agreements to add another 25 million. Mastercard is one of its supporters. The largest private lender in India, HDFC Bank, is its main client. The startup’s technology was also utilized by HDFC Bank to restore its PayZapp digital payments platform.
Additionally, the firm collaborates with Sparrow Financial and Pluxee, a global provider of corporate benefits.
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