E-payment solutions firm FSS raises over $57M from PremjiInvest, eyes IPO by 2016

Chennai-based finance management solutions and financial planning services company, Financial Software & Systems Pvt Ltd (FSS), has raised Rs 350 crore ($57 million) from PremjiInvest, the personal investment vehicle of Wipro chairman Azim Premji.

The capital raised from this round will be used for innovations in digital payments for electronic and mobile commerce industry, besides financial inclusion and remittance businesses. A part of the money will also go into expanding its operations in global markets.

This is the company's fourth round of funding. FSS had earlier raised two rounds of funding from private equity fund Carlyle Group, NEA Associates and Jacob Ballas Capital, an India-focused PE advisory firm. Carlyle exited the firm in the third round of funding.

"In the next 18 to 24 months, we plan to go public. The fact that FSS has consistently attracted PE investments over the past two decades and this latest investment from PremjiInvest will enable us to prepare for the IPO," said Nagaraj Mylandla, founder and MD of FSS.

FSS was founded in 1991 by Mylandla. A banker-turned entrepreneur, Mylandla had earlier worked with the Indian banking industry. He also had stints with FDC and ACI in the US.

A global payment systems company, FSS offers products in the areas of e-payments and financial transaction processing. It also offers FSSNeT, which provides hosted payment processing services across delivery channels, including ATMs, PoS, internet and mobile. The services include card management, merchant management, internet payment gateway, mobile banking & mobile payment and reconciliation & settlement, and ATM management services on a pay-per-use model including leasing ATM and site management.

The company claims that it serves over 100 organisations in the public and private sectors, financial institutions and payment processors. Its clients include ICICI Bank and HDFC Bank.

Headquartered in Chennai, FSS has offices in Australia, Canada, Europe, Middle East, Singapore and the US. FSS employs over 1,500 people.

The firm is looking to clock revenue of about Rs 850 crore this fiscal, a 38 per cent increase over Rs 614 crore reported in FY14. The company aims revenue of Rs 2,200 crore by 2019 fiscal.

Mumbai-based Avendus Capital advised the company on the latest investment.

(Edited by Joby Puthuparampil Johnson)