Mintoak, an Indian e-commerce startup focused on merchant payments, has acquired Digiledge, a company specializing in Central Bank Digital Currency (CBDC) solutions, in a $3.5 million deal. This acquisition marks a significant milestone as the first of its kind in India’s CBDC space, according to sources close to the matter, as reported by Reuters.
Strengthening Payment Solutions for Indian Banks
Through the acquisition of Digiledge, Mintoak aims to expand its capabilities in the rapidly evolving CBDC sector. The deal will allow Mintoak’s partner banks—HDFC Bank, Axis Bank, and State Bank of India (SBI)—to offer payment solutions utilizing the e-rupee, India’s central bank digital currency. Mintoak CEO Raman Khanduja emphasized that the acquisition would help simplify access to digital payment tools and financial services for merchant acquirers, particularly benefiting small and medium-sized enterprises (SMEs) across the country.
“Our goal is to make it easier for merchant acquirers to grow and assist more SMEs in accessing digital tools and financial services,” Khanduja stated.
Growth of India’s CBDC Initiative
India’s central bank, the Reserve Bank of India (RBI), launched its e-rupee pilot in December 2022, initially limiting its use to banks. However, in April 2023, the scope of the pilot expanded to include payment firms. While the initiative has gained traction, the adoption of the e-rupee has been slow. As of June 2024, the RBI reported reaching just 1 million retail transactions, a milestone only achieved after local banks began offering incentives and partially disbursing employee salaries in the digital currency.
Despite this progress, the RBI had previously aimed for a daily transaction target of 1 million by late 2023 to test the scalability of the system. However, the push for higher transaction volumes has since been scaled back, leaving questions about the future trajectory of the digital currency initiative due to the gap between incentivized usage and actual adoption by users.
A Pivotal Moment for Mintoak
The acquisition of Digiledge is seen as a strategic move for Mintoak as it positions itself to play a key role in India’s digital currency ecosystem. The company’s strong ties with major Indian banks such as HDFC, Axis, and SBI provide a solid foundation to offer innovative CBDC-based payment solutions to a broader market.
By integrating Digiledge’s CBDC expertise, Mintoak is poised to enhance its offerings, ensuring that businesses, especially SMEs, can navigate the evolving digital payments landscape and adopt new financial technologies as the government pushes for broader CBDC adoption.
With this acquisition, Mintoak further establishes itself as a significant player in the digital payments space in India, aligning with the government’s goals to drive the adoption of the e-rupee and increase financial inclusion across the country.
