Bengaluru-based fintech firm Innoviti Payment Solutions Pvt. Ltd has won an ex-parte injunction against digital retail payments platform Pine Labs for infringement on its patent for technology enabling UPI payments at point-of-sale (PoS) terminals.
Innoviti had filed a suit for infringement against Pine Labs before the City Civil Court, Bangalore and received the interim restraining order on Tuesday.
The interim order restricts Pine Labs from manufacturing, selling, distributing, advertising, exporting, offering for sale, procuring and dealing with this technology through its Plutus Smart or any other device in India, Innoviti said in a statement.
Plutus Smart is Pine Lab’s android-based smart transaction machine that enables merchants to process the entire cycle of a sales transaction with a hand-held device.
An ex-parte injunction refers to a direction to restrain, granted by a court of law for an urgent matter where only one party is heard. A full hearing involving all parties will take place at a later date.
The complaint was regarding Innoviti’s transaction-specific dynamic-QR technology, for which it has patent rights till March 29, 2037. The technology involves scanning a dynamically generated QR-code from the display screen of a regular credit or debit card POS terminal. Once scanned, the POS terminal automatically initiates a payment authorisation request on the user’s mobile app, which in turn results in a UPI-payment charge-slip being printed and/or a confirmatory SMS being generated.
Innoviti has already licensed the technology to several partner financial organisations, the statement said.
The company claims to be processing 4.3% of overall retail digital payment transactions in India with a throughput of around Rs 6 lakh per terminal per month. Across India, Innoviti processes around $5 billion (over Rs 34,000 crore) payments annually from over 1,000 cities, the statement said.
The firm also claims to have filed 16 patent applications in the areas of automatic acquirer fallback, auto-settlement, dynamic-QR on payment terminals and others.
The company has raised $35 million funding to date from investors like Catamaran Ventures, SBI-FMO fund, Bessemer Venture Partners and Trifecta Capital.
Founded in 1998 and incorporated in Singapore, Pine Labs started out by providing card-based payment solutions for the retail petroleum industry. In 2012, it re-oriented its focus toward the cloud-based PoS platform.
Pine Labs says its merchant payments’ platform has been used by over 100,000 merchants in 3,700 cities and towns across India and Malaysia.
In May last year, Singapore state investment firm Temasek and American payments giant PayPal Holdings Inc invested $125 million (Rs 843 crore then) in Pine Labs. The transaction came after private equity firm Actis Capital leading an $82 million (Rs 530 crore then) investment in the company.
Sequoia India, which first invested in Pine Labs in 2009, remains the company’s largest shareholder.