Bangalore-based Naffa Innovations Pvt Ltd, which runs a mobile payment technology startup under the brand of ToneTag, has raised $1 million (Rs 6.4 crore) in funding from Reliance Venture Asset Management, it said on Monday.
Founded in 2013, ToneTag allows mobile payments using sound (tone) or NFC (tag), thereby enabling any mobile device to make payments without the need of internet. ToneTag, primarily a product company, will also be releasing mobile applications for sellers in near future. It enables contactless payment solution in the existing payment eco system by integrating its proprietary software development kit (SDK) at both merchant (mobile, PoS, EDC) and customer interaction points (m-wallet, m-banking apps).
Unlike NFC or QR Codes, which are hardware dependent, ToneTag works on all mobile devices, including feature phones and does not require any capital investment in existing infrastructure, the company said.
"We plan to use most of the funding for hiring technical and sales & marketing resources—marketing for influencing user adoption and sales to enable merchants accept cashless transactions," said Himaghna Dey Sarkar, vice president & head of business development at ToneTag.
The venture was co-founded by Kumar Abhishek and Vivek Kumar Singh with clutch of angel investors like Ram Sellaratnam and Rajesh Yohahanna backing it.
Abhishek has eight years of professional experience related to multi-country core banking implementations, mobile and internet banking. He started his career with IBM and prior to starting ToneTag, he was with Finacle core banking at Infosys. He has also worked as a senior engineer with MindTree.
Vivek Kumar Singh deals with legal frameworks and financial domain at ToneTag. Prior to co-founding this venture, he was involved with mobileGullak.
For Reliance Venture Asset Management, an early-stage alternative investment arm of Reliance Capital, this is the first addition to its portfolio in almost four years, according to VCCEdge, the data research platform of VCCircle.
It has invested in companies like online travel agency Yatra.com and internet-based payment collection service provider Suvidhaa among others besides being an investor in early-stage investor Seedfund.
This is separate from Reliance Capital's erstwhile PE arm Reliance Equity Advisors that has been renamed as Fairwinds Asset Managers Ltd, after its top team completed a spin-off early last year.
Mumbai-based boutique investment bank Multistrato Capital Advisors was the financial advisor for the investment in ToneTag.