Digital identity and regtech platform IDfy has raised ₹476 crore (about $52–53 million) in a new funding round led by Neo Asset Management’s Neo Secondaries Fund. The investment comes at a time when demand for digital verification, fraud prevention, and compliance technology is growing rapidly across sectors.
The fresh capital will help the company expand globally, invest in new products, and pursue strategic acquisitions. The funding highlights increasing investor interest in India’s regtech and digital trust ecosystem.
Funding Details: Mix of Primary and Secondary Investment
The ₹476-crore round includes both primary and secondary components. The primary portion will bring fresh capital into the company, while the secondary part will provide partial exits for early investors and employees.
Apart from Neo Asset Management, existing investors such as Blume Ventures, Analog Capital, Elev8, IndiaMART, and Kae Capital also participated in the round. This structure allows the company to raise new funds while also rewarding early backers who supported the startup during its early growth years.
What IDfy Does: A Key Player in Digital Trust
Founded in 2011, IDfy builds technology that helps companies verify identities, detect fraud, and manage regulatory compliance. Its platform is used by enterprises across multiple sectors, including banking and financial services, e-commerce, gaming, HR and recruitment, logistics, and the sharing economy.
The company offers solutions such as digital onboarding, background verification, fraud detection, and privacy governance through an integrated platform.
Scale of Operations and Market Reach
IDfy has grown into a major player in the digital trust space. According to company data, it serves hundreds of enterprise clients across more than 10 sectors and runs hundreds of millions of verification checks each year.
The company operates across seven countries, including India, Southeast Asia, and the Middle East, with international markets contributing a growing share of its revenue.
How the New Funds Will Be Used
The company plans to use the fresh capital in three main areas. One focus area is global expansion, with plans to enter new international markets and strengthen its presence in existing ones. Another priority is strategic acquisitions, as the startup looks to expand its technology capabilities and customer base. The company also intends to invest in product development, especially in identity verification, risk management, and privacy solutions.
The broader goal is to build a global digital trust infrastructure that can serve billions of users.
Rising Demand for Regtech Solutions
The funding comes as regulatory requirements around data protection and fraud prevention are increasing worldwide. Governments and regulators are pushing stricter compliance rules, especially in digital finance and online services.
In India, new data protection frameworks and the rapid growth of digital payments are creating fresh demand for identity verification and compliance tools. Companies across sectors now need reliable systems to verify customer identities, prevent fraud, manage data privacy, and comply with regulatory rules.
This shift is driving growth in the regtech sector.
Financial Performance and Growth Path
IDfy has shown steady revenue growth in recent years. The company reported operating revenue of around ₹186 crore in FY25, compared to ₹145 crore in FY24. It also reported a small net profit after posting losses in the previous fiscal year.
Since its founding, the company has raised more than $120 million across multiple funding rounds. With improved financial performance and fresh capital, IDfy is now focusing on scaling its global operations.
Investor Confidence in India’s Regtech Sector
The latest funding round reflects strong investor confidence in the regtech space. As digital services expand, the need for secure identity systems and compliance tools is rising.
Investors are increasingly backing companies that provide identity verification, fraud detection, risk management, and privacy governance. IDfy operates at the intersection of these areas, making it a key player in the digital trust ecosystem.
Competition and Market Landscape
The regtech and identity verification market is becoming more competitive, with several startups and global players entering the space. However, IDfy has built a strong enterprise client base and expanded into international markets, giving it a competitive advantage.
Its integrated platform approach, covering onboarding, verification, and compliance, is also a key differentiator.
Role of AI and Automation in IDfy’s Strategy
IDfy uses AI and machine learning to power many of its solutions. These technologies help detect suspicious behaviour, identify fraud patterns, automate verification processes, and reduce manual checks.
AI-driven systems allow companies to verify users faster while reducing the risk of errors or fraud. As digital transactions increase, automation is becoming essential for large-scale identity checks.
Global Expansion Plans
With the new funding, IDfy plans to strengthen its presence outside India. The company already operates in several Asian and Middle Eastern markets.
International expansion is expected to focus on regions where digital financial services are growing, compliance requirements are tightening, and online onboarding is increasing. These markets offer strong demand for identity verification and regtech services.
Possible IPO Plans in the Future
Industry reports suggest that IDfy may consider a public listing in the coming years if growth continues. The company is aiming for higher revenue targets before exploring an initial public offering.
Strong financial performance and global expansion could support such plans.
What This Means for India’s Startup Ecosystem
The ₹476-crore funding round is another sign that investors continue to back Indian enterprise technology startups. While consumer internet companies often get more attention, sectors like regtech, fintech infrastructure, and compliance technology are seeing steady investment.
This trend reflects a broader shift toward B2B technology startups, compliance and security solutions, and enterprise software platforms.
Impact on Businesses and Consumers
For businesses, stronger identity verification tools can reduce fraud losses, improve customer onboarding, ensure regulatory compliance, and build user trust.
For consumers, better digital verification systems can lead to safer online transactions and fewer identity-related risks.
Bottom Line
IDfy’s ₹476-crore funding round marks a major step in the growth of India’s regtech and digital identity sector. Led by Neo Asset Management, the investment will support global expansion, acquisitions, and product innovation.
As digital transactions and data regulations increase worldwide, companies like IDfy are becoming critical infrastructure providers. The latest funding shows that investors see strong long-term potential in the digital trust and compliance technology market.
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Last Updated on Friday, February 13, 2026 2:37 pm by Startup Magazine Team
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