VCs and fintech startups rush to tap the latest retail investor craze

Groww, Stable Money, Grip Invest and Wint Wealth are among companies that are riding the wave, looking to cash in on bond investments.

Grip Invest, a series A wealth-tech company, is in talks with Orios Venture Partners and existing investors to raise almost $8 million, two sources aware of the development told Mint. Wint Wealth is also exploring early conversations for its next round of funding with new backers, two sources said.

Also read: Municipal bodies still shun public bond issues. There’s a lot that’s holding them back

Grip Invest did not comment on the development. Ajinkya Mukund Kulkarni, co-founder and CEO at Wint Wealth, confirmed there had been interest from investors, but said the company was still exploring this and hadn’t actively started pursuing its next round of funding.

Two other companies eyeing the space, India Bond and Bondbazaar, have also begun funding talks with VCs, two sources told Mint. IndiaBonds declined to comment on the fundraise, while queries sent to Bondbazaar did not elicit a response at the time of publishing this story.

A bond is essentially a loan agreement where an investor lends money to a borrower (like a company or government) for a set period, and in return, the borrower promises to repay the principal amount (face value) plus interest (coupon payments) at a specified future date (maturity). Essentially, it’s a fixed-income security that represents debt.

Bond investments are increasingly catching investors’ attention thanks to a strong tech ecosystem, a regulatory push, and promises of stable returns. Retail bond investments via online bond platform provider or OBPP-licensed platforms have seen explosive growth, rising from ₹242 crore in June 2024 to ₹972 crore by April 2025 — a staggering 430% CAGR, according to NSE and BSE data compiled by Stable Money.

There has been a 327% increase in monthly transactions of corporate bonds and structured debt instruments (SDIs) over the past year, said a Business Today report in February. This is due primarily to Sebi’s OBPP licence, which it introduced in 2022 to regularise investments in bonds.

“We’re seeing a marked shift in investor behaviour since FY24-25. Retail investors are increasingly viewing bonds not just as an alternative to FDs, but as a core part of their asset allocation strategy,” said Vishal Goenka, co-founder, IndiaBonds. “There’s growing interest in state-guaranteed bonds, high-yield NCDs and even in new products like digital FDs. With a volatile equity market and a benign interest rate cycle in the country we have seen volumes on our platform double in just the past six months.”

Incumbents join the rush

Existing wealth-tech players are also entering the new segment to cash in on the rush. Stable Money, which once focused on FDs, diversified into bonds last year. The segment, which makes up less than 10% of its assets under management (AUM), is expected to grow to as much as 50% by December 2026. The company aims to triple its current AUM of ₹3,000 crore by then, Saurabh Jain, CEO and co-founder, told Mint.

“We believe bonds are an emerging wealth product, much like how mutual funds, stocks, and F&O have scaled over time. There are very few regulated products with this kind of potential. With simplified KYC and fully digital processes, it has become much easier to offer bonds online,” he said. The company raised $20 million in a round led by Fundamentum earlier this month.

Groww, one of the largest online stock brokers, which entered wealth management through its recent acquisition of Fisdom, isn’t far behind. The company is in the process of applying for the online bond platform provider (OBPP) license, which Sebi introduced in 2022 to regularise investments in bonds. Since then, platforms need this license to facilitate the buying and selling of listed, rated, and regulated bonds online. More than 30 companies hold this license as of June 2025, according to Sebi’s website.

Regulatory push made it possible

Apart from the credibility boost from OBPP licences, the framework also allowed small-ticket investments in bonds (starting from ₹10,000), giving retail investors better access to the asset class, in May 2024.

In November 2024, changes to the advertising code for OBPPs further eased uncertainty for potential investors. 

Wint Wealth’s Kulkarni explained, “Earlier, we had restrictions under the advertisement code which was tailored for equity brokers. In December 2024, updated advertisement code came that enabled describing ourselves as a platform which provides securities having fixed returns. Such a proactive regulatory step has helped get clarity while building trust and improving investor confidence.” Kulkarni added that a large chunk of the company’s growth came after these changes in regulations.

Also read: What drives the new corporate love for the bond market

However, a VC who has chosen not to invest in the segment, and who did not wish to be named, said that while these platforms may show growing AUMs, many are not profitable and their monetisation models are still evolving. “Interest rates are already starting to come down. Bonds are yield products, so if rates drop further, the core value proposition weakens,” this person added. This impact is already visible on FDs. Over the past year, the RBI has cut the repo rate twice, which has reduced FD interests, making them less attractive.

On the contrary, according to a Grip analysis based on data from Prime Database and the RBI, certain type of bonds, such as ‘A’ rated corporate bonds, have consistently offered yields between 10-11% over the past decade, in contrast to fixed deposit rates, which closely track the repo rate.

Nishit Garg, partner at RTP Global, said it was because of these stable rates that interest in certain bond categories began growing after the framework was introduced. “It’s a natural evolution. Real estate is becoming unaffordable, traditional investments are saturated, and middle India is now actively looking for stable, alternative avenues for wealth creation,” said Garg, who has led RTP Global’s investments in Stable Money and Dexif.

Is the market big enough?

Amit Nawka, partner at PwC India, said the bond market remains largely untapped, which presents significant potential for growth. “As interest rises and more players — including fintechs — enter the space, success will hinge on building investor awareness and trust, while staying aligned with evolving regulatory requirements,” he added.

Peers in the industry agreed that while competition was intensifying, this was a largely positive development as the market would grow and investors would learn more about bonds, much like what happened with stocks and mutual funds.

Doing their own thing

Companies are approaching the bond market in different ways. Stable Money, for example, is aiming to nudge its FD customers to take slightly more risk for better returns through government bonds.

“One major reason is that margin-wise, bonds are slightly better than fixed deposits. Also, retail penetration in corporate bonds is just 0.5%, while fixed deposits are already a ₹75 trillion business. Even if 2% of users shift, that’s an incremental ₹1.5 trillion opportunity in bonds. It’s an emerging category, and we want to be at the forefront of it,” said Jain.

Also read: Two NBFCs have asked bondholders to ease covenants. Here’s why.

Others such as Wint Wealth and Grip Invest are looking to acquire first-time users through bonds or shift mutual fund investors into a slightly safer asset class amid market uncertainty.

Dexif, meanwhile, is building an infrastructure layer that allows financial advisors, wealth managers, and distribution platforms to offer bonds to customers.

“Bonds are an amazing product but awareness is very low—mostly limited to corporations or ultra-high-net-worth individuals,” said RTP’s Garg, an investor in the company. “To truly democratise bonds, we need to bring independent, neutral advisors into the picture, people already trusted by the masses.”