OneStack, a Mumbai-based fintech infrastructure provider to cooperative banks, has raised ₹12.5 crore in a round led by new investor Shepherd’s Hill, with existing backers Pentathlon Ventures and AVNM Ventures participating, the company said on 4 November 2026. The funds will take OneStack’s cooperative bank clients deeper into UPI as direct issuers and acquirers with NPCI.
The round takes OneStack’s total funding to about ₹45 crore across four rounds. It follows the company’s $2 million round to digitise cooperative banks in March 2025, led by Pentathlon Ventures, and an undisclosed Series A tranche in February 2026.
How OneStack puts cooperative banks on UPI rails
OneStack says its partner banks are now live as UPI issuers and acquirers directly with the National Payments Corporation of India (NPCI), under their own bank handles. That lets a cooperative bank issue UPI IDs to its customers, onboard merchants and settle payments on its own rails, instead of relying on an intermediary bank.
In practice, the bank keeps the customer relationship, the transaction data and the merchant discount rate (MDR) income. “Cooperative banks have always had their communities’ trust, but on UPI they were disconnected from their own customers,” founder Amit Kapoor said, as The Economic Times reported.
The revenue case has grown since NPCI introduced a 0.4% MDR on UPI transactions above ₹2,000, capped at ₹300 per transaction and shared between the issuing bank, acquiring bank, payment providers and NPCI. A bank on both sides of a merchant payment earns on both.
What the ₹12.5 crore will fund
The company plans to use the money to:
- Expand its client base among cooperative banks and non-banking financial companies (NBFCs)
- Build out its payments products, including UPI issuing, merchant acquiring, QR payments and SoundBox devices
- Develop its OneCBS core banking system and debit card management tools
- Grow its compliance suite, which is integrated with the Indian Cyber Crime Coordination Centre (I4C)
For NBFCs, OneStack plans customer verification and fraud-reporting tools. The company is an Aadhaar OVSE technology service provider, has integrated eKYC Setu and holds RuPay debit card issuance certification, according to Entrackr.
Who OneStack serves
Founded in 2019 by Amit Kapoor, who earlier co-founded payments company Airpay, OneStack has grown from a white-label mobile banking provider into a full-stack platform. It says it serves more than 200 banks, including state cooperative banks, district central cooperative banks (DCCBs) and non-scheduled urban cooperative banks.
It has partnered with a large private sector bank that sponsors more than 250 cooperative banks, and has been onboarded as a technology service provider on Sahakar Sarathi, a shared services entity promoted by NABARD, NCDC and rural cooperative banks.
Why it matters for cooperative bank technology
NABARD’s 2024-25 annual report counts 34 state cooperative banks and 351 DCCBs with nearly 15,900 branches, and RBI data shows 1,457 urban cooperative banks. Many of these lenders find it costly to build digital banking, cybersecurity and reporting systems on their own. Shared platforms such as OneStack, and partnerships like Infobip and Tesync’s AI digital lending for cooperative banks, let them modernise without giving up their local identity.
Ashutosh Ghanekar, General Partner at Shepherd’s Hill, said the fund backs OneStack’s work to bring cooperative banks onto modern financial rails, while Pentathlon Ventures said its repeat investment reflects conviction in the segment.
Key takeaways
- OneStack raised ₹12.5 crore led by Shepherd’s Hill, taking total funding to about ₹45 crore.
- Its cooperative bank clients now run UPI as direct NPCI issuers and acquirers under their own handles.
- The money will fund expansion to NBFCs and its payments, OneCBS core banking and compliance products.
FAQ
Who led OneStack’s ₹12.5 crore round?
Shepherd’s Hill led the round as a new investor, with existing investors Pentathlon Ventures and AVNM Ventures taking part.
What does direct UPI access mean for cooperative banks?
Banks can issue UPI IDs and onboard merchants under their own NPCI handles, keeping customer data and MDR income instead of passing it to a sponsor bank.
How many banks use OneStack?
OneStack says it serves more than 200 banks, including state cooperative banks, DCCBs and urban cooperative banks.
Featured image: Representative image of a Pune District Central Co-operative Bank branch in Pune. Photo: DesiBoy101 via Wikimedia Commons (CC BY-SA 4.0).
