Paytm raises $1.4 bn funding from SoftBank, gets war chest to boost payments bank ops
The funding will help Paytm expand its soon-to-be launched payments bank operations
New Delhi: Japanese conglomerate SoftBank has pumped in US $1.4 billion (over Rs 9,079 crore) in Indian digital payments platform, Paytm.
The funding will help Paytm -- operated by One97 Communications -- expand its soon-to-be launched payments bank operations as well as grow its user base and introduce more financial products for consumers.
"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," SoftBank Group Chairman and CEO Masayoshi Son said.
SoftBank, which was an early investor in Alibaba, has committed investments of over US $10 billion in India.
While it has pumped in close to US $2 billion into Indian startups like Snapdeal, Ola and Housing.com in last few years, it has also written off a significant portion of that on account of loss in valuation.
The investment comes at a time when SoftBank is working on a sale plan of e-commerce firm Snapdeal. SoftBank is the largest shareholder in Snapdeal, which is locked in an intense battle with Amazon India and Flipkart.
Paytm has been one of the prominent beneficiaries of the government's move last November to scrap high denomination notes. It has seen manifold growth in transactions on its platform as well as expansion in number of users.
Paytm founder and CEO Vijay Shekhar Sharma said: "This investment by Softbank and support of the incredible entrepreneur Masa Son is a great endorsement of our team's execution and vision."
The company plans to invest Rs 10,000 crore over the next three to five years to enable half a billion Indians to join the mainstream economy, Paytm said in a joint statement.
Paytm offers mobile wallet (over 220 million users) and e-commerce services and will launch its payments bank operations from May 23. It had raised US $60 million from Taiwanese chip maker MediaTek last year.