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Financial services conglomerate DMI Group has acquired buy now pay later (BNPL) platform ZestMoney. DMI Finance, the non-banking financial company arm of DMI Group, will be the preferred lender on the Zest platform.

The acquisition will enable DMI to widen its engagement with current and potential customers by adding the ZestMoney checkout financing platform to its product suite, the company said in a statement. DMI will also bring its customer base, balance-sheet strength, and significant risk-management experience to drive growth across Zest’s online and offline merchant network, the statement added.

Delhi NCR-based DMI Group provides credit solutions for consumption, personal, and MSME needs. Founded in 2008, it claims to have raised over $1.5 billion of equity investment.

“We have partnered with ZestMoney for 8+ years in various capacities. We firmly believe that this acquisition will be an important step in our journey to provide digital financial inclusion at scale across India,” said Shivashish Chatterjee, Co-founder and Joint Managing Director of DMI.

The BNPL startup officially downed its shutters in December 2023 after a failed acquisition bid by Walmart-backed PhonePe.

Reports suggest that Lizzie Chapman and Ashish Anantharaman, the co-founders of ZestMoney, have set up SwiffyLabs, a B2B finance infrastructure company, as part of Jio Platforms.

“DMI has been at the forefront of digital lending in India. They bring strong capital support and deep expertise. DMI has been an early supporter of ZestMoney and we are very excited to take our partnership to a whole new level,” said Mandar Satpute, Chief Operating Officer of ZestMoney.

The crisis at ZestMoney started after the Reserve Bank of India (RBI) barred non-bank institutions from loading credit lines into prepaid payment instruments. The lender started crumbling after PhonePe called off the potential acquisition of ZestMoney for a sum ranging between $200-300 million. PhonePe decided to abandon the deal, citing concerns related to due diligence.