The fintech start-up ZestMoney is closing down its operations by the end of this month, as informed to its employees on Tuesday.  

As reported by The Economic Times, its sources mentioned that two major financial companies supporting ZestMoney withdrew their credit lines last week, citing regulatory restrictions on unsecured lending imposed by the Reserve Bank of India (RBI) in November. 

Mandar Satpute, who recently became the chief banking officer after the founders left, informed the tech team that they should start job hunting because the company can only pay salaries until the end of this month (December). 

The report added, citing its sources, that the company’s management might attempt to sell the product and its customer base, but Zest is essentially left without any ongoing business. 

Currently, ZestMoney has around 40 to 50 tech and product employees.

ZestMoney's decision to shut down comes after it couldn't recover its business following unsuccessful acquisition talks with fintech major PhonePe in March this year. 

In November 2022, PhonePe was considering buying the company. This potential deal would have been PhonePe's entry into digital lending. Reports suggested the deal's value was estimated to be between $200-$300 million. However, in March, the fintech company, backed by Walmart and valued at over $10 billion, decided not to proceed with the acquisition due to problems uncovered during the thorough examination of ZestMoney's operations. 
 
The founders of the fintech, Lizzie Chapman, Priya Sharma, and Ashish Anantharaman, stepped down on May 15. This happened just two months after PhonePe decided not to go through with the plan.