Indian e wallet provider Paytm secures $1.4bn SoftBank investment
Indian e wallet service provider, Paytm has secured an investment of $1.4 billion from Japanese internet and telecom major giant SoftBank Group.
The investment which was made in the Paytm owner company, One97 Communications marks the largest round of funding from a single investor in India.
SoftBank investment in Paytm values the Indian mobile payment app company at nearly $7 billion as reported in the media. The $1.4 billion investment from SoftBank in Paytm is for a stake of about 20% in the QR code mobile payment app creator, reported Livemint based on details gathered from anonymous sources.
SoftBank chairman and CEO Masayoshi Son has been quoted in The Hindu Business Line on SoftBank investment in Paytm, as saying: “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.”
Paytm, the mobile payment platform which had become hugely popular since Indian Prime Minister Narendra Modi’s demonetization announcement in November last year, is expected to use the SoftBank investment to further expand in the country’s payment ecosystem.
The latest Softbank funding in India through Paytm is set to complement the e wallet provider’s investment of INR 10,000 Cr (around $1.6 billion), planned to for the next three to five years aimed at bringing in about half-a-billion Indians into the digital cashless economy.
A statement from Paytm after securing Softbank investment, read: “We have been going from strength to strength in our payments division. Our zero cost QR Code-based payment solution has been adopted by millions of merchants and is now synonymous to digital payments in India.
“Going forward, we will continue to innovate and expand into new online and offline use-cases so we can serve you better, and that’s a promise.”
Livemint further reported that SoftBank is set to purchase Paytm shares of worth $400m from an early investor – SAIF Partners in what would be a secondary transaction which would also include buying of a minority stake from Paytm founder Vijay Shekhar Sharma.
SoftBank investment in Paytm has dramatically raised the value of the Indian mobile payment app company which was $6 billion in March last year following the purchase of a nearly 4.3% combined stake from Paytm investors Reliance Capital, SVB and SAP Ventures by the China-based Alibaba Group and Ant Financial Services Group.
Prior to that in August 2016, Paytm secured a significant funding of $60 million from Taiwanese fabless semiconductor company which raised its valuation to nearly $5 billion.