On 23 January, fintech Pine Labs—which plans to go public soon—acquired enterprise loyalty-programme-management company Saluto Wellness. It was the company’s fourth buy in the past 12 months, aimed at diversifying revenue by offering a variety of software and value-added services.
The venture-capital firm Sequoia-backed fintech has been doubling down on inorganic growth ahead of its US$500 million initial public offering initial public offering Financial Express Pine Labs may shift $500-m IPO to India Read more by acquiring firms such as payments-infrastructure provider Setu, payments-solution company for small enterprises Mosambee, and Mumbai-based online-payments startup Qfix.
Saluto’s acquisition, three years after the point-of-sale (PoS) solution provider the gifting platform Qwikcilver, will add employee engagement and channel-partner programmes to Pine Labs’ growing gift-and-loyalty-card-issuing business. Pine Labs is the top issuer of prepaid payment instruments prepaid payment instruments PPIs PPIs let people purchase goods and services, enable remittance, etc. against the value stored in them. (PPIs) in India, with over 185 million gift and loyalty cards as of November 2022, according according RBI ENTITY-WISE PPI STATISTICS Read more to the Reserve Bank of India (RBI).
The digital-payments vertical is still Pine Labs’ mainstay. But monetisation has become tricky with the rise of the Unified Payments Interface (UPI) as the largest method for peer-to-merchant peer-to-merchant NPCI UPI Ecosystem Statistics Read more (P2M) transactions.
On every debit- or credit-card transaction, retailers pay a 0.4-1.99% fee called the merchant discount rate (MDR), which is split among the card-issuing bank, card network (Visa, Mastercard, Rupay), and the PoS-terminal provider such as Pine Labs.
While there’s no MDR on UPI and Rupay transactions, the share of debit- and credit-card transactions in digital payments has also slumped to 2.6% and 2.5%, respectively, as of December 2022, according to the RBI RBI RBI PICTORIAL REPRESENTATION OF TRENDS IN PAYMENT SYSTEMS Read more .