Published: Sat, May 20, 2017
Money | By Armando Alvarado

Paytm raises $1.4 billion from SoftBank

Paytm raises $1.4 billion from SoftBank

Mobile payment and commerce platform Paytm, run by One97 Communication Ltd, has raised $1.4 billion funding by the Japanese internet and telecom major SoftBank Group, the company said here on Thursday.

Paytm stated that the funding will complement its investment plan of around $1.6bn in the next three to five years.

SoftBank has committed investment of over $10 billion in the Indian market. "We believe we have a great opportunity to bring financial inclusion to half a billion Indians", Sharma said in a statement. We are proud to be Paytm's strategic partner and be a part of the great story as it emerges as the country's biggest and fastest growing fintech company.

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In addition, Paytm witnessed an uptake in its movie ticketing and travel booking (rail, bus and flight tickets) businesses. Sharma informed that after this deal, Softbank will get a seat on the Paytm board. SoftBank and Paytm declined to give details. That increased to $6bn in March 2016 when Alibaba Group and Ant Financial Services Group bought a combined stake of almost 4.3% from three Paytm investors Reliance Capital, SVB and SAP Ventures.

SoftBank 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".

Paytm, which has around 230 million wallet-users, plans to launch its payments bank on May 23, and will use the money to acquire new 500 million customers and launch a slew of financial service products such as wealth management, deposits, and money lending, among others. The company had to write off a significant portion of that after the devaluation of those investments. Prior to this round, the payments firm, which started life as mobile value added service delivery platform in 2000, raised $60 million from Taiwan's Mediatek at a $4.8 billion valuation in August a year ago. With the completion of this financing round, Paytm has now raised over $2 billion while its e-commerce entity separately raised $200 million led by Alibaba earlier this year. One of the biggest gainers of that demonetization was a start-up called Paytm, who via persistent advertising were already gaining popularity as a cashless app or mobile wallet in the Indian market.

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