Chinese Capital Returns, CRED Gets RBI’s Nod, and CARS24’s Acquisition

Chinese venture capital acted as a primary engine for India’s startup boom for nearly a decade. From ride-hailing and fintech to food delivery, many of India’s most valuable companies counted Chinese firms among their early backers. That pipeline froze almost overnight in 2020. Five years later, the capital is beginning to flow again, though it looks nothing like it did before.

The initial wave arrived in the mid-2010s as Alibaba Group, Tencent, and Ant Group searched for growth markets beyond China. They saw an Indian internet population that was expanding fast and a digital services sector that reminded them of China ten years prior. These investors soon became the backbone of the ecosystem. Alibaba and Ant Group poured funds into Paytm to help it dominate digital payments, while Tencent backed major players like Swiggy, Byju’s, and Ola. This influence extended into gaming, logistics, and social media, making Chinese funds a permanent fixture in the market.

By the end of that decade, Chinese capital was the most aggressive funding source in the region. These investors provided more than money. They offered operational blueprints from a Chinese internet economy that had already mastered the art of building massive consumer platforms.

Everything stopped in 2020. After border clashes between the two nations, the Indian government implemented strict foreign direct investment rules. Any investment from a country sharing a land border with India now required explicit government approval. Officials framed the move as a way to stop opportunistic takeovers of Indian firms while valuations were low during the pandemic.

This policy essentially ended most new Chinese investments. Deals stalled. Venture funds that once led the market could no longer close transactions without facing months or years of regulatory review.

The venture capital world is built to adapt. As Indian startups matured and needed more cash, the industry realized that cutting off such a massive pool of global capital was a difficult long-term strategy. Regulators eventually began to soften their stance on specific deals, especially those routed through global funds or structures that allowed for better oversight.

Now, Chinese capital is returning to India through the back door. Instead of the massive, direct checks that once made headlines, the money moves through global venture funds, limited partner commitments, or international vehicles that mix Chinese capital with money from other regions. The source remains the same, but the delivery mechanism is designed to look global. This shift helps bypass regulatory hurdles while giving Indian founders access to the funding they need.

Founders now face a landscape far more complex than the one they navigated before 2020. Raising money is no longer a simple matter of valuation. It requires balancing geopolitics, national security concerns, and data governance.

Venture capital rarely leaves a promising market for long. When one path closes, the money finds a new way in. Chinese investment may not be the lead story anymore, but its return proves that these financial ties are harder to break than they appear.

Let’s go through what else is happening in Indian startup world - Grab your simmering cup of StartupChai.in and unwind with our hand-brewed memes.

“Nil Batte Sanata”: 6,789 DPIIT-Recognized Startups Have Shut Shop, Says MoS Commerce

Union MoS Commerce Jitin Prasada said 6,789 DPIIT-recognized startups have shut down so far across sectors like IT services, healthcare, edtech, agriculture, and hardware. Yet the ecosystem remains large, with over 2.12 Lakh recognized startups in India as of January 2026.

The government added that 219 incubators have been backed under SISFS with ₹945 Cr committed to support early-stage ventures.

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“Miya Bibi Ho Raazi”: CRED Gets RBI’s Final Nod To Operate As Payment Aggregator

Fintech platform CRED has received the Reserve Bank of India’s final approval to operate as a payment aggregator, allowing it to onboard merchants and manage payments, settlements, and refunds across multiple instruments.

The company had earlier secured the in-principle nod for the license back in April 2024.

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“Janmo Ke Saathi”: After Car Info, IPO-Bound CARS24 Acquires Vehicle Info

IPO-bound CARS24 has acquired automotive utility startup Vehicle Info as it pushes to evolve from a car marketplace into a full-stack vehicle ownership platform.

The idea is to support users not just during the buying or selling moment, but across the entire lifecycle of owning and managing a vehicle. The move also builds on its earlier January acquisition of CarInfo, signaling a deeper bet on vehicle data and ownership services.

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“Aaiye Aapka Intezar Tha”: Practo Appoints Ex-Union Health Secretary CK Mishra As Independent Director

Healthtech platform Practo has appointed former Union Health Secretary CK Mishra as an independent director as the company prepares for its planned IPO. Mishra brings nearly 38 years of administrative experience as a retired IAS officer who has held several senior government roles.

The move comes as the Bengaluru-based startup looks to raise fresh capital ahead of its public market debut.

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1. Constems-AI has raised $2 Mn (₹18.3 Cr) in a pre-Series A round led by Finvolve, with participation from investors including Inflection Point Ventures. The startup will use the funds to improve its Vision AI models, expand R&D, and strengthen its product engineering.

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2. Boba Bhai has raised ₹40 Cr in fresh funding from investors including Kunal Shah, Abhishek Goyal, and Mekin Maheshwari to expand its offline footprint. The startup plans to scale stores across Tier I and Tier II cities and launch new products.

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3. Bonkers Corner has raised $15 Mn in a Series A round led by India SME Investments, with the funding expected to include both primary capital and secondary share sales. The brand plans to use the funds to deepen its offline retail push.

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4. OpenCFO has raised $2 Mn in fresh funding led by Endiya Partners, with participation from angel investors across the US and India. The startup plans to use the capital to expand its engineering and treasury teams as it scales its agentic AI-powered SaaS platform.

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5. Aikyam Capital Group has raised ₹205 Cr in the first close of its private credit fund structured under Aikyam Capital Trust. The fund targets ₹300 Cr with a ₹100 Cr greenshoe option and will deploy structured capital to businesses while aiming to deliver risk-adjusted returns.

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6. Confluxe has launched operations after raising $1.6 Mn in pre-seed funding led by Wavemaker Partners, with participation from Kriscore Capital. Founded by former executives from Myntra and H&M, the startup is building technology solutions for the retail sector.

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7. Lumikai has led a $1.5 Mn seed round in NPrep, which is building a video-first platform for nursing entrance exam preparation. The startup aims to use AI and digital learning tools to help students prepare for high-stakes nursing exams and pursue global healthcare careers.

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8. Skye Air Mobility has secured $9 Mn in the first close of its Series B round led by IAN Alpha Fund, the second VC fund from the Indian Angel Network. The round, split into $4 Mn (Series B1) and $5 Mn (Series B2), also saw participation from AVNM Ventures, Faad Capital, and Bajaj Capital.

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