Amazon Pay acquired Bengaluru-based startup Tapzo

Tinuku - Amazon India’s payments arm, Amazon Pay, has acquired Bengaluru-based and Sequoia-backed startup Tapzo, as the e-commerce giant attempts to aggressively ramp up its payments business and get a bigger slice of India’s booming digital payments economy, currently dominated by the likes of Paytm.

According to sources, Amazon Pay India bought out Tapzo in a cash-and-stock deal, valuing the startup at US$30-40 million. Prior to its acquisition, Tapzo counted the likes of Sequoia Capital and American Express Co. among its investors, and had raised over $20 million since it started out in 2009.

Tinuku Amazon Pay acquired Bengaluru-based startup Tapzo

According to one of the source, the talks with Amazon began sometime during the beginning of 2018. Amazon did not confirm whether the company had bought Tapzo, but a spokeswoman said the company remained focused on building its digital payments business in India.

“Our commitment to the vision of a less-cash India remains the same. Our goal is to make it easier than ever before for customers to make digital payments by improving customer experience, affordability and daily routines,” the Amazon spokeswoman said.

Tapzo founder Ankur Singla did not respond to requests for comment. As part of the deal, Singla and his team at Tapzo will join Amazon. Founded in 2009 as a complaint redressal forum called Akosha, the service was rebranded and launched as Helpchat.

Helpchat started out as a personal assistant platform with a chatting feature, but even that pivot proved unsuccessful for Singla and the rest of his team. Eventually, Helpchat was pivoted and re-launched as an all-in-one platform, Tapzo, in November 2016. In its current avatar, Tapzo allows users to access over 35 apps, including the likes of Flipkart, Amazon, Uber and Ola, among others.

Over the past two years, Amazon has been aggressively investing in building its digital payments business in India and has even invested in a number of payments and fintech startups to boost its offerings. Earlier this year, Amazon invested $22 million in digital lending firm Capital Float, and also $12 million in digital insurance startup Acko.

In May, Mint first reported that Amazon had also backed digital payments start-up ToneTag. Earlier on Tuesday, Amazon separately launched a new bill payments service, which will enable prepaid and postpaid bill payments through its Amazon Pay wallet. As part of the new service, Amazon has forged tie-ups with hundreds of billers for electricity, mobile and broadband bill payments, among others.

The news of Amazon acquiring Tapzo comes on a day when India’s largest digtial payment services provider Paytm, owned by One97 Communications Ltd, announced that it had raised an undisclosed amount from Warren Buffett-owned Berkshire Hathaway Inc.

Berkshire’s investment manager Todd Combs, who was leading the investment discussions with Paytm, will be joining the board of One97 Communications. Buffett’s Berkshire Hathaway Inc is set to buy a 3-4% stake for Rs 2,200-2,500 crore in One97, making it the billionaire investor’s first investment in an Indian company. The current round pegs Paytm’s valuation at about $10-$12 billion.

Also on Tuesday, Google announced it was partnering with four Indian banks —HDFC Bank Ltd, ICICI Bank Ltd, Kotak Mahindra Bank Ltd and Federal Bank Ltd—to offer instant, pre-approved loans to customers “right within Google Pay in a matter of seconds”.