Could India be the next BNPL market? Zip Co (ASX:Z1P) thinks so and is putting its money where its mouth is.

Zip told shareholders it was making an investment in ZestMoney, a BNPL operator in India which boasts 11 million registered users, 10,000 merchants and a presence of over 75,000 physical stores.

The deal involves Zip chipping in US$50 million upfront and it has rights to increase its shareholding over time and to a board seat in the future.

The company says the investment was consistent with its strategy of building a global BNPL business.


The BNPL opportunity in India awaiting Zip

Zip also says India is expected to be a huge BNPL market.

Citing data from Redseer, an internet-focused consulting firm, Z1P said that by FY26, India is expected to have US$300 billion in BNPL payment volume.

That volumed will be driven by online shopping trends and India’s relatively young population, with more than half of its 1.4 billion population under 30.

“With more people using digital payments and online shopping, ZestMoney can positively impact hundreds of millions of lives in the coming years,” said Zip CEO Larry Diamond.

“With deep partnerships with online and offline merchants and lending partners, ZestMoney is poised to accelerate growth as the market develops.

“We have been incredible impressed with the founders and leadership team and look forward to the next stage of the ZestMoney journey.”

ZestMoney’s boss Lizzie Chapman also lauded the deal.

“This is deep validation of our position as the market leader in BNPL category in India,” she said.

“We believe India will leapfrog traditional products like credit cards along with many other emerging markets, going straight to digital payment solutions.

“We strongly believe India will emerge as the largest BNPL market in the world over the next 5 years.”

Zip shares edged slightly higher in morning trade.

Zip (ASX:Z1P) share price chart



There is precedence for ASX stocks trying to get into the Indian market.

While India offers the promise of a large population but with a democratic system (at least in theory) there have been mixed results.

Tech stocks have been the most successful with examples including:

But other sectors have had difficulty.

For instance, bug-killer Zoono (ASX:ZNO) took approximately two years and 12 visits by managing director Paul Hyslop to get sales started in India.

Digital education stock iCollege (ASX:ICT) had a slow-growing Indian arm for several years based in Delhi, but took some time to produce its first revenue.

And telco tech stock Vortiv (ASX:VOR), which was then known as Transaction Solutions International, was in 2016 it was hit by a decision from the Modi government to demonetise 500 and 1000 rupee notes in the name of reducing corruption and the black economy.