OneStack, a fintech startup that builds banking and funds expertise for cooperative banks, has raised Rs 12.5 crore in a funding spherical from new investor Shepherd’s Hill and present backers Pentathlon Ventures and AVNM Ventures.

The startup mentioned the raised capital will fund growth throughout cooperative banks and non-banking monetary firms (NBFCs), together with product growth in funds, core banking and regulatory compliance.

Together with this spherical, OneStack has raised greater than Rs 45 crore throughout 4 funding rounds. Its different buyers embody 9Unicorns, growX Ventures, Stride Ventures, Samved VC, Silicon Highway Ventures and Enterprise Catalysts.

The funding from Shepherd’s Hill comes from its maiden non-public fairness fund, launched in 2025. The India-based asset supervisor has invested in Indian listed equities since 2011, and the brand new fund is sector-agnostic.

Cooperative banks on UPI beneath their very own names

Alongside the funding, OneStack mentioned cooperative banks utilizing its platform at the moment are reside as each UPI issuers and acquirers straight with the Nationwide Funds Company of India (NPCI), every beneath its personal financial institution deal with.

Meaning a cooperative financial institution can subject UPI IDs to its personal clients, join its personal retailers and settle funds by itself rails. The startup mentioned the financial institution retains the client relationship, the transaction information and the service provider low cost fee (MDR) and different fee income, as an alternative of passing them via a bigger middleman financial institution.

“Cooperative banks have all the time had their communities’ belief, however on UPI they had been disconnected from their very own clients,” mentioned Amit Kapoor, founder and CEO of OneStack.

“That places the financial institution, not an middleman, on the centre of each fee its clients make.”

Kapoor mentioned that with MDR returning to UPI, proudly owning each side of the fee turns into a income alternative for each cooperative financial institution.

“With this capital, we’ll take our funds, core banking and compliance merchandise to extra cooperative banks and produce the identical capabilities to NBFCs,” he added.

Why MDR issues for small banks

Below the federal government’s new framework, most person-to-merchant UPI funds above Rs 2,000 will carry a 0.40% MDR, capped at Rs 300 per transaction. Some classes, together with invoice funds, gasoline and schooling, will appeal to a flat Rs 5 charge.

The cost was because of begin on 15 October. Two days earlier than that, NPCI deferred it until after Diwali, stating that it “shall be applied instantly submit Diwali at a date to be notified individually”.

Its value noting that the construction of the charge was not modified.

What OneStack does

OneStack was based in 2019 by Amit Kapoor, with Vishal Gupta becoming a member of as co-founder in 2023. Kapoor beforehand co-founded and led funds firm Airpay.

The startup sells expertise that lets smaller monetary establishments provide digital companies with out constructing the infrastructure themselves. Its platform covers cell banking, UPI issuing and service provider buying, QR funds, branded SoundBox units for retailers, debit card administration and its OneCBS core banking system.

It started as a white-label cell banking supplier and later constructed its personal UPI change and fee service supplier stack.

OneStack claims it serves greater than 200 banks, together with state cooperative banks, district central cooperative banks and non-scheduled city cooperative banks.

OneStack raised $2 million in a Sequence A spherical in March 2025, led by Pentathlon Ventures, with Yatra Angel Community and Enterprise Catalysts among the many co-investors. In February 2026 it raised an undisclosed quantity in the identical ongoing Sequence A spherical, led by Samved VC and Silicon Highway Ventures, taking its complete funding on the time to about $4.24 million.

“Our choice to again OneStack once more displays our conviction in each the chance and the founders’ capacity to execute,” mentioned Sandeep Chawda, managing companion at Pentathlon Ventures, a seed-stage B2B tech fund.

Ashutosh Ghanekar, basic companion at Shepherd’s Hill, mentioned the agency was excited to companion with Kapoor and the crew “as they hold constructing the digital infrastructure that brings India’s cooperative banks and the thousands and thousands they serve onto fashionable monetary rails.”