OneStack raises $1.32m to expand digital banking services

By Divya Shah

Why it matters: The funding supported digital banking adoption among smaller financial institutions, expanding UPI capabilities, payment ownership and financial inclusion across India

Indian FinTech infrastructure company OneStack raised approximately $1.32 million (INR 12.5 crore) in a funding round led by new investor Shepherd’s Hill, with participation from existing investors Pentathlon Ventures and AVNM Ventures. The investment aimed to support the company’s expansion across cooperative banks and non-banking financial companies (NBFCs).

OneStack provided banking technology that enabled cooperative banks to offer digital payment and banking services under their own brands. Through its platform, cooperative banks connected directly with the National Payments Corporation of India (NPCI) as both Unified Payments Interface (UPI) issuers and acquirers, using their own bank handles.

This allowed banks to issue UPI IDs to customers, onboard merchants and manage payment settlements through their own payment infrastructure. It also enabled them to retain customer relationships, transaction data and revenue from merchant discount rates (MDR) and payment services.

Including the latest investment, OneStack raised more than $4.75 million (INR 45 crore) across four funding rounds.Its investors included Pentathlon Ventures, 9Unicorns, growX Ventures, Stride Ventures, Samved VC, Silicon Road Ventures and Venture Catalysts.

The company’s earlier funding supported its expansion from a white-label mobile banking provider into a full-stack banking technology platform. Its offerings included OneCBS, a core banking system, branded SoundBox devices for merchants, and its own UPI switch and payment service provider (PSP) infrastructure.

The latest funding round came as OneStack focused on expanding its platform through sponsor-bank partnerships. The fresh capital was expected to support market expansion across cooperative banks and NBFCs, along with product development in payments, core banking and regulatory compliance.

OneStack also expanded its services for NBFCs with customer verification and fraud reporting tools. Its compliance solutions included integration with the Indian Cyber Crime Coordination Centre (I4C). The company also operated as an Aadhaar Offline Verification Seeking Entity (OVSE) technology service provider, integrated eKYC Setu and held RuPay Debit Card issuance certification and SU3J licences under credit bureaus.

Founded by Amit Kapoor, OneStack provided technology that helped smaller financial institutions introduce digital banking services without building their own infrastructure. Its platform combined mobile banking, UPI issuing, merchant acquiring, QR payments, debit card management and core banking capabilities.

Amit Kapoor, founder and CEO of OneStack, said the return of MDR on UPI created new revenue opportunities for cooperative banks that managed both sides of payment transactions. He added that the funding would help the company expand its payments, core banking and compliance solutions to more cooperative banks and NBFCs.

The company served more than 200 banks across India, including state cooperative banks, district central cooperative banks (DCCBs) and non-scheduled urban cooperative banks (NSUCBs).