PayU raises holding in payments startup Mindgate to 70%

PayU, the payments and fintech arm of Prosus NV, has raised its stake in Mumbai-based Mindgate Solutions to 70%, moving from a minority investor to majority shareholder as competition intensifies in India’s fast-growing real-time payments market.

The deal leaves Mindgate’s co-founders, George Sam and Guhan Muthuswamy, with a combined 30% holding. Terms of the transaction weren’t disclosed.

“Mindgate continues to play a crucial role in the growth journey of India’s real-time payments by powering 10 billion monthly transactions and providing seamless payment solutions to leading banks,” Sam, co-founder and business head, said in a statement.

In March, PayU had announced the acquisition of a 43.5% stake in payments infrastructure startup Mindgate Solutions. While the companies did not reveal details of the deal, an Economic Times report pegs the valuation at around $300 million.

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Established in 2008, Mumbai-based Mindgate Solutions provides digital payment solutions to banks, governments, merchants, and corporations.

Mindgate provides the software backbone that enables India’s banks to integrate with UPI and process real-time payments securely at a massive scale. The company claims it processes billions of UPI transactions per month through partner banks.

The company has an established presence in several markets, including MENA, ASEAN, Europe, and the US, which could provide PayU with additional international growth opportunities.

“Our additional investment in Mindgate underscores our confidence in its strong performance and the vast growth potential in India’s real-time payments ecosystem,” Anirban Mukherjee, PayU’s chief executive, said.

Despite PayU’s majority ownership, operational control will remain with Mindgate’s founders. “Our success in India is built on the strength of our issuing platform, which has been central to the growth of real-time payments for leading banks and institutions,” said Muthuswamy, Mindgate’s Co-founder and software architect. “With PayU’s strong merchant stack complementing our capabilities, we now have the combined advantage of addressing the acquiring side of the payments ecosystem.”