OneStack raises Rs 12.5 crore to take cooperative banks onto UPI

OneStack, a fintech company that sells digital banking technology to cooperative banks, has raised Rs 12.5 crore in a funding round led by new investor Shepherd's Hill, according to start-up funding reports published on Wednesday, 4 November 2026. Existing investors Pentathlon Ventures and AVNM Ventures also took part. The company plans to use the money to reach more cooperative banks and non-banking finance companies (NBFCs) and to build more payment and compliance products. OneStack says it has now raised more than Rs 45 crore across four rounds.

India's cooperative banks are small lenders, often owned by their members, that serve towns, districts and villages, small traders, farmers and salaried workers. Many of them run on old software, and they have been slower than large commercial banks to offer the mobile apps and UPI payments that customers now expect. When a cooperative bank cannot offer its own UPI handle, its customers may move their everyday payments to another bank, and the cooperative loses deposits and contact with them.

OneStack is one of a group of start-ups that sell these banks a ready-made technology stack, so that a small bank does not have to build or buy each system separately. In industry terms it acts as a technology service provider and an application service provider: it supplies the software and also runs it for the bank. A UPI switch is the system that connects a bank to the national UPI network run by the National Payments Corporation of India, and a BBPS switch does the same for Bharat BillPay, the national bill-payment system. With these in place, a cooperative bank's customers can pay by UPI and pay bills under the bank's own name.

This is the kind of start-up that grows beyond the metros. Its customers are spread across smaller cities and rural areas, and its success depends on how many district-level banks it can sign up and keep. The company has said it aims to reach 500 banks over the next two years. These are the company's own targets and claims, and they have not been independently checked.

Peepals calculation: this round of Rs 12.5 crore is about 28% of the more than Rs 45 crore the company says it has raised in total (12.5 / 45 = 0.28). The company also says it processes more than Rs 750 crore a year in UPI transaction value and expects to cross Rs 1,000 crore by the end of the financial year, a rise of about a third (1,000 / 750 = 1.33). Our calculation from the reported figures.

Short-term: OneStack will use the money to sign up more cooperative banks and NBFCs and to add payment and compliance products, according to the reports.

Long-term: if more cooperative banks can offer UPI and mobile banking under their own names, customers in smaller towns may not need a second bank account at a large lender for everyday payments.

Who is affected: cooperative banks and their customers in towns and villages, NBFCs looking for ready-made payment systems, and other fintech companies selling to the same banks.

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