Possibly months before its much anticipated IPO, merchant platform Pine Labs announced on Thursday that it is all set to enter into the payment gateway space. Foray into the payment gateway space marks a natural progression for the Noida headquartered company, which has a dominant presence in the POS, BNPL and other areas.
Pine Labs has added a new vertical at a time when the company is in the midst of preparing for its public listing, possibly at NYSE or Nasdaq. This step may bode well for its plans to create optimism among investors for its IPO listing. Investors may like the fact that Pine Labs is adding another potential revenue earning stream and this may propel investors to buy Pine Labs’ shares at a higher price in the open market.
Its online payment solutions will be offered under the brand name Purple and total three products will be offered under this brand name – Purple Gateway, Purple Checkout and Purple Console. But it is Purple Gateway that is the main offering of the company and it will seek to leverage its vast userbase in the Merchant community to popularize Purple Gateway.
To the best of my knowledge, Pine Labs services including its POS terminals are used by over 1,00,0000 merchants across India and Southeast Asia. Although Pine Labs’ deep roots in the merchant community can hardly be doubted, making a dent in the payment gateway won’t be all that easy.
The payment gateway space is ruthlessly competitive and the space recently witnessed a massive consolidation, after PayU acquired BillDesk for nearly $4.7 Bn barely two months. Billed as the most expensive acquisition deal ever in India’s startup space, the deal has propelled PayU in the payment gateway market.
Apart from PayU, Pine Labs will also face tough competition from other highly funded startups like Citrus Pay, Razorpay, CCAvenue and InstaMojo.