Digital payments and e-commerce player Paytm has raised about USD 1.4 billion (Rs 9,000 crore) from Japanese internet giant SoftBank in its biggest-ever fund-raising round.
SoftBank gets a seat on Paytm’s board as part of the deal. Founded by Vijay Shekhar Sharma in 2010 as a digital bill payment and recharge platform, Paytm raised its first major round in 2015 when Chinese fintech player Ant Financial pumped USD 500 million into the company. In 2017, Chinese e-commerce behemoth Alibaba also infused about USD 177 million, with Saif Partners investing about USD 23 million. The funding from the Japanese conglomerate comes at a time when Paytm is set to launch its payments bank on May 23.
Paytm said it plans to invest about Rs 10,000 crore over the next three-five years to bring in about half-a-billion people into the digital economy. “As part of the vision, the company will soon launch the Paytm Payments Bank, a mobile-first product that will reach every corner of the nation,” it added.
However, a company spokesperson said that not all of the current funding will go into the payments bank. Paytm also has an e-commerce business, which, earlier this year, was spun off into a separate entity — Paytm E-commerce.
SoftBank, which has so far written off billions of dollars on its investment in Indian ventures, is bullish about Paytm’s growth.
In a statement, SoftBank’s Chairman Masayoshi Son said: “In line with the Indian government’s vision to promote digital inclusion, we are committed to transforming the lives of hundreds of millions of Indian consumers and merchants by providing them digital access to a broad array of financial services, including mobile payments.” – The Hindu Business Line