RAZORPAY

Harshil Mathur and Shashank Kumar met at IIT Roorkee. After graduating, Harshil was working at Schlumberger and Shashank at a startup.

They were both trying to build side projects and kept running into the same wall: accepting online payments in India was a nightmare. The options were either non-existent, absurdly complex, or required you to be a registered business with a mountain of paperwork just to collect money.

In 2014, they decided to solve it. They applied to Y Combinator — got rejected the first time — but came back in 2015 and got in.

That YC batch was the turning point. The validation, the network, and the $120,000 check gave them enough runway to build the first version of what would become India's most important payments API.

The original pitch was simple: give developers a clean API to accept payments without the bureaucratic nightmare. No middlemen.

No 45-day integration timelines. Just a few lines of code.

Indian startups were exploding at the time — Flipkart, Ola, Zomato — and every single one of them needed payments infrastructure. Razorpay showed up exactly when the market needed it most.

Razorpay makes money the old-fashioned payments way: it takes a small cut of every transaction it processes. Businesses pay around 2% per transaction to accept payments through Razorpay's platform.

That sounds tiny. Process $90 billion a year and it stops sounding tiny.

But Razorpay has expanded well beyond just taking a slice of transactions. Today it's essentially a full financial services stack for Indian businesses.

It offers payment gateway services, business banking accounts (RazorpayX), payroll processing (Opfin, which it acquired), lending, and even a neobanking product. The strategy is classic fintech land-and-expand: get businesses onboarded with payments, then sell them everything else they need to manage their money.

The customer base ranges from tiny startups accepting their first payment online to large enterprises processing millions of transactions a day. Enterprise clients get custom pricing.

Smaller businesses pay the standard rates. The volume at the bottom of the market alone is enormous — India has hundreds of millions of small businesses coming online for the first time, and Razorpay wants to be their financial operating system.

The core product is the Razorpay Payment Gateway — the API and dashboard that lets any business in India start accepting credit cards, debit cards, UPI, net banking, and wallets in minutes. It handles the complexity so developers don't have to.

This is still the engine that drives everything.

RazorpayX is the business banking arm. It gives companies a current account, automated payouts, expense management, and API-driven banking — basically the financial infrastructure layer for startups and SMEs who don't want to deal with traditional bank branches and their associated misery.

Razorpay Payroll (built on their Opfin acquisition) handles employee salaries, compliance, tax filings, and benefits. It's the natural next step once you have a business's payments and banking — why not take payroll too?

Subscriptions and recurring billing tools have become increasingly important as India's SaaS economy has grown. Razorpay handles the entire subscription lifecycle — trial management, dunning, renewal — so software companies can focus on building rather than chasing failed payments.

Razorpay Capital offers short-term working capital loans to businesses based on their transaction history on the platform. The data advantage here is real: Razorpay knows exactly how much money a business processes, which makes credit underwriting significantly easier than a traditional bank flying blind.

The developer-first playbook was the whole game. While Indian competitors were trying to sign enterprise contracts with big banks and retailers, Razorpay went directly to the people building the internet: developers.

Clean documentation. A sandbox to test in.

An API that actually worked. Word spread fast in India's developer community, and startups started onboarding themselves with zero sales effort required.

Timing mattered enormously. The Indian government's demonetization push in 2016 — where 86% of all currency notes were suddenly declared invalid overnight — forced hundreds of millions of people online for payments almost by accident.

It was chaotic and painful for the economy, but it accelerated digital payments adoption by years. Razorpay was already in position when the wave hit.

The UPI revolution helped even more. India's Unified Payments Interface became one of the most successful government fintech projects in history, and Razorpay built on top of it aggressively.

When digital payments in India went from a niche to a default behavior, Razorpay was already the infrastructure layer that everyone was building on. They didn't create the wave.

They just had the best surfboard.

Razorpay operates in one of the most regulated industries in one of the most complex regulatory environments on earth. The Reserve Bank of India has the power to make or break the company with a single policy change — and it has occasionally done exactly that.

In 2022, the RBI barred Razorpay from onboarding new merchants for a period due to compliance concerns. For a company whose entire growth model depends on onboarding new businesses, that kind of regulatory action is existential.

Competition is brutal and only getting worse. PayU, CCAvenue, and Paytm have been fighting in this market for years.

PhonePe and Google Pay dominate the consumer side. Stripe has been eyeing India seriously.

And Jio — Mukesh Ambani's telecom and tech empire — has the distribution, the capital, and the political relationships to enter payments at scale whenever it chooses. Razorpay's moat is real but it isn't impenetrable.

The IPO question is also looming. Investors have been patient, but the path to liquidity matters.

Valuations for Indian fintech have been volatile. Razorpay hit a $7.5 billion valuation in 2021 during the peak of the funding frenzy.

Whether that number holds up as the company approaches a public market test is the question nobody has fully answered yet.

Y Combinator was the first institutional bet — the 2015 batch gave Razorpay the credibility and network to raise seriously. That initial backing was the signal that opened Indian and global VC doors.

Sequoia Capital India (now Peak XV Partners) became a core long-term investor and has participated in multiple rounds. When Sequoia backs an Indian startup repeatedly, the market pays attention — they have one of the best track records in Indian venture capital.

Ribbit Capital, which has backed Robinhood and Coinbase, came in as Razorpay started looking more like a full financial services platform than just a payments company. That vote of confidence from a specialist fintech fund mattered for the narrative.

GIC, Singapore's sovereign wealth fund, led the $375 million Series F in 2021 that pushed the valuation to $7.5 billion. Sovereign wealth fund participation at that level signals that Razorpay had moved from promising startup to genuine infrastructure company with long-term staying power.

Salesforce Ventures and Tiger Global have also been involved, reflecting both the strategic and growth investor interest in what Razorpay has built.