The demand for contactless payments and e-commerce has increased in South Korea during the COVID-19 pandemic. This is good news for payment service providers, but the market is very fragmented so adding payment options is a time-consuming process for many merchants. CHAI wants to fix this with an API that allows businesses to accept over 20 payment systems. The Seoul-based startup announced today that it has raised a Series B worth $ 60 million.
The round was chaired by Hanhwa Investment & Securities, with the participation of SoftBank Ventures Asia (the early stage venture capital arm of SoftBank Group), SK Networks, Aarden Partners and other strategic partners. This brings CHAI's total funding to $ 75 million, including a Series A of $ 15 million in February.
Last month, the Bank of Korea, South Korea's central bank, released a report that found that () contactless payments have increased 17% year over year since COVID-19 began.
CHAI serves e-commerce businesses with an API called "I & # 39; mport" that allows them to accept payments from over twenty options, including debit and credit cards through local payment gateways, digital wallets, wire transfers, carrier billings and PayPal. It is now used by 2,200 dealers including Nike Korea and Philip Morris Korea.
Daniel Shin, CHAI's chief executive officer, told TechCrunch that companies would typically have to integrate each type of online payment method separately, saving I & # 39; mport its customers a lot of time.
The company also offers its own digital wallet and debit card called the CHAI Card, which was launched in June 2019 and now has 2.5 million users. This is a small number when compared to South Korea's leading digital wallets which include Samsung Pay, Naver Pay, Kakao Pay, and Toss.
"CHAI is a late arrival in the Korean digital payments market, but we saw a unique opportunity to add value," said Shin. The CHAI card offers merchants a lower transaction fee than other cards. Typically, users check their app about 20 times to get new cashback offers and other rewards based on how often they pay with their cards or digital wallet.
"We have digitized the plastic card experience and this is the first step in creating a robust online rewards platform," added Shin.
In a press release, Hanhwa Investment & Securities Director SeungYoung Oh said, “I & # 39; mport has reduced what used to take weeks for e-commerce businesses to a simple copy-and-paste task and cost drastically reduced. It is a unique business model in Korea and I have no doubt that CHAI will continue to build this service into an essential infrastructure of global fintech Landscape."