Digital payment giant Paytm has received new funding of $ 1 billion (about Rs 7162 crore). Under this funding, led by US-based asset management firm T Rowe Price, the company’s valuation has increased to $ 16 billion (about Rs 1,14,586 crore).
This is the largest amount raised by an Indian startup this year. According to the plan, T Rowe Price, Discovery Capital and D1 Capital will invest about $ 400 million, existing investors SoftBank will invest $ 200 million and Ant Financial $ 400 million.
Paytm will invest this money in the expansion of both online and offline businesses and will also give aggressive expansion to the financial services business. Company founder Vijay Shekhar Sharma, informing the English newspaper Times of India about this investment, said that the company will now focus on new-age banking and insurance business along with debt distribution.
He said, ‘We are in the final stage of application of license for general insurance business. About 1.5 crore merchants have been added with us and in the next two years we will be able to add 2 crore new merchants. The company will invest about Rs 10,000 crore in the next 3 years to expand in rural markets. Sharma said that the company will also focus on its payment gateway business.
Paytm founder and PayTm CEO Vijay Shekhar Sharma was recently named by Forbes as the richest Indian at number 56. Paytm is playing a big role in the fast moving digital era after demonetization.
Who is challenging Paytm?
Significantly, in the year 2018, Paytm received an investment of $ 300 million from Berkshire Hathaway, a company of veteran investor Warren Buffett. Then the valuation of Paytm was up to 10 billion dollars. Paytm is currently getting competition from companies like Google Pay, Phone Pay, Amazon Pay, but it remains the market leader.
However, Paytm’s parent company One 97 Communications suffered a huge loss in the last financial year ending March 31. On a consolidated basis, the company incurred a net loss of Rs 4,217 crore. This includes businesses of Paytm Money, Paytm Financial Services, Paytm Entertainment Services, etc.