India has 100 unicorns now. The Bengaluru-headquartered neobank Open entered the coveted club on Monday with a new funding round, it said.

The five-year-old startup did not disclose the size of its Series D funding, but a source familiar with the matter said it’s about $50 million. The new round, which valued Open at $1 billion, was led by Mumbai-headquartered IIFL, the two said. Existing backers Tiger Global, Temasek and 3one4 Capital also participated in the round.

Open operates a neobank that offers small and medium-sized businesses as well as enterprises nearly all the features of the bank with additional tools to serve the needs of a business. Millions of small and medium sized businesses in India struggle with maintaining multiple bank accounts, bookkeeping of their daily spending, and bandying out payments to employees.

The startup, which has partnerships with over a dozen top banks in India, is used by more than 2.3 million businesses, it said. Open processes over $30 billion worth transactions each year.

In recent quarters, Open has expanded its offerings. The startup now provides its neobanking technology to banks in a white-label licensing arrangement, who then sell it to their customers.

The growth of Open in recent years, which has led to several other startups expand to and innovate in this category, has dramatically changed the relationship between banks and fintechs. Just a few years ago, most banks in India were skeptical of neobanks and it was very difficult to persuade any of them for a partnership, fintech founders have told TechCrunch.

“Neobanks are gaining prominence as platforms to digitise banking or bank-like services for millennials and SMEs. Top-4 global neobanks are worth $100 billion and Indian fintechs have made a start through likes of Open, RazorpayX, Fi, and Jupiter,” wrote analysts at Jefferies in a report last year.

“In fact, many Indian fintechs plan to expand from 1-2 platforms now to neobank over 3-5 years. Incumbent banks/NBFCs are partnering with them. Monetisation is some time away,” they added.

Open said it is looking to launch three new products — revenue-based financing Flo, early settlement card offering Settl and working capital lending Capital — in the coming months to expand its offerings for its customers. The startup is targeting to disburse $1 billion in lending through its new products within the next 12 months, it said.

“We are excited to partner with IIFL and existing investors Tiger Global, Temasek and 3one4 Capital for our series D round. We see a lot of synergies with IIFL especially on leveraging the lending book, as we are getting ready to launch innovative products like revenue-based financing, early settlement, working capital loan and business credit cards to SMEs on our platform,” said Anish Achuthan, co-founder and chief executive of Open, in a statement.

This is a developing story. More to follow…