Mobile payments startup ToneTag raises $10 mn: Report
Bangalore-based Naffa Innovations Pvt. Ltd, which operates mobile payments technology platform ToneTag, has raised $8-10 million from a group of investors led by Amazon Inc. and Mastercard, a report in a financial daily stated, citing three people in the know.
The company is currently in talks with other strategic investors, business daily Mint reported, citing the persons mentioned above who requested anonymity.
A spokesman for ToneTag declined to comment on the development. Email queries sent to Amazon and Mastercard did not elicit a response till the time of publishing this report.
ToneTag enables mobile payments using sound (tone) and near-field communication (NFC) tags, thereby enabling any mobile device to make payments without the Internet. It integrates its proprietary software development kit at both merchant (mobile and point-of-sale) and customer interaction points (mobile wallet and mobile banking apps).
The startup was founded in 2013 by Kumar Abhishek and Vivek Kumar Singh. Abhishek, who is its chief executive, worked with tech companies Infosys, MindTree and IBM in the past. Singh, a chartered accountant by qualification, is the finance and product chief at ToneTag. He was previously a financial analyst at mobileGullak, a platform that offered payment and loyalty management solutions for retailers.
Unlike NFC or QR Codes, which depend on hardware, ToneTag works on all mobile devices, including feature phones, and does not require any capital investment in existing infrastructure. Besides payments, Tone Tag also offers location-based services and proximity-based consumer engagement solutions.
In January this year, VCCircle had reported that the company had raised Rs 8.5 crore ($1.33 million) in a fresh round of funding. Previously, in 2015, ToneTag had raised $1 million from Reliance Venture Asset Management, the venture capital arm of Reliance Capital Ltd.
In November 2016, the company had raised funding from Nasscom foundation trustee Arun Seth; former Infosys finance head TV Mohandas Pai, former Snapdeal chief product officer Anand Chandrasekaran and Deepak Ghaisas, chairman at Gencoval Strategic Services Pvt. Ltd.
The company is also backed by Elevate Innovation Partners and Aakash Prakash, founder of Singapore-based Amansa Capital, who was formerly director of investments for India at Singapore state investment firm Temasek Holdings.
Last year, the company rolled out a product called ToneTag Retail Pod for retailers. The pod is a device that looks like a round portable bluetooth speaker. Customers just have to tap their phones on the device, which then emits a sound wave carrying data that is received by the mobile phone. Once this happens, the payment is complete. A company spokesperson claimed that the retail pod is shipped to a number of countries across the Middle East, Southeast Asia, North America and some African nations.
The company’s technology can also be used for contactless money withdrawals from ATMs, cashless payments at toll plazas and parking, and mobile payments at railway ticket counters, according to information available on its website.
Its technology has been adopted by a number of large companies including international paytech firm First Data and private sector lender ICICI Bank. The company has also partnered with Mastercard and Finacle to onboard their banking clients. ToneTag claims to have a reached over 50 million customers and has worked with more than three lakhs merchants.