Razorpay announced its acquisition of TERA Finlabs, an AI-based risk tech SaaS platform. TERA Finlabs implements technology, risk and capital solutions to allow financing solutions for businesses. This purchase of TERA Finlabs is followed by Razorpay’s strategy of financially supporting as many MSMEs as possible by making core competencies in capital solutions, credit underwriting, and data-driven risk management capabilities. TERA will provide a technology stack, risk management capabilities, and onboarding solutions to create and enable a credit line for Razorpay’s merchant network.

Harshil Mathur, CEO and Co-Founder, Razorpay, said in a statement, “In India, banks are cautious of granting business loans to startups and new SMEs because of the risks associated with new revenue models of startups. Through Razorpay Capital, we have been trying to solve these cash flow challenges, making it easier for businesses to get finance and grow. And growing in that journey, an acquisition fits perfectly with our vision of promoting tailor-made affordable credit solutions for the underbanked small businesses across industries so that they can digitally transform and disrupt. Together, we are watching forward to addressing newer working capital issues faced by MSMEs and soon create a major dent in the credit space in the next few years.”