Co-led by GIC, which is the sovereign wealth fund of Singapore, and existing investor Sequoia Capital, Payments company Razorpay has closed a $100 million financing round. In the process, they have topped $1 billion in valuation and has become the first Indian neo-bank to hit that benchmark.

Existing investors of Bengaluru-headquartered Razorpay have also participated in the latest equity financing round which includes Palo Alto-based financial services-focused investment firm Ribbit Capital, New York-headquartered Tiger Global Management, famed Silicon Valley-based startup accelerator Y Combinator and top-tier domestic venture capital firm Matrix Partners India.

"India has made significant strides in establishing a digital payments ecosystem and Razorpay has established itself as a clear leader, with its strong focus on customer experience and product innovation. GIC has a long track record of partnering with leading fintech companies globally and is delighted to partner with Razorpay in its journey to transform payments and banking," Choo Yong Cheen, chief investment officer for private equity at GIC, said in a statement.

"Both RazorpayX and Razorpay Capital have seen very good traction. The first focus area is to go deeper and build more products around these. The payments business is almost breaking even, and that does not require that much funding. We need to put more fuel into the fire, and that's where a significant portion of the capital will go towards," Mathur added.

"India's digital ecosystem is seeing unprecedented growth with online shoppers expected to cross 350 million by 2025. This trend of digitisation is penetrating India across social strata and geography and Razorpay is playing a pivotal role in this transformation by enabling millions of merchants to accept digital payments in a frictionless and efficient manner. They have expanded the breadth of products and solutions rapidly across payments and banking and are becoming a platform for all financial technology needs of their customers," Ishaan Mittal, principal, Sequoia Capital India, said.

"We will power payments and banking for 50 million businesses by 2025. We will continue to make an impactful contribution to the growth of the industry, aid adoption in the under-served markets and drive new practices and a new thinking for the industry to follow. And this investment fits perfectly with our growth strategy," Mathur lastly added.