Japan's SoftBank Group has invested US$1.4 billion (RM6.07 billion) in the parent of India's Paytm, giving the digital payments start-up a boost as it looks to expand its user base and maintain its market lead in Asia's third-largest economy.
Paytm's user base exploded a year ago when the government killed India's highest denominations in physical cash, sending millions scurrying toward mobile payments to get around a shortage of physical currency.
The Paytm payment wallet will move to the Paytm Payments Bank Limited in the same capacity.
In an earlier interaction with DH, a Paytm executive had said that the company is investing around Rs 350 crore to begin the journey in the payments business. In January 2014, it launched the Paytm Wallet, which is now the largest digital wallet with over 220 million users and is accepted by over 5 million offline merchants across India.
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Softbank has now become the second biggest investor in Paytm, after Alibaba.
India's leading mobile wallet and payments company Paytm has reportedly raised $1.4 billion from Japanese investor SoftBank in its largest funding to date, months after roping in China's Alibaba as an investor into its marketplace business unit. "We are excited to partner with Paytm in this journey and will provide them with all our support", said Masayoshi Son, Chairman & CEO, SoftBank Group Corp. As per the Central bank's guidelines, the company will transfer its wallet business to the newly incorporated payments bank entity under a payments bank licence awarded to Founder and CEO Vijay Shekhar Sharma.
"Paytm Payments Bank Ltd (PPBL) has received the final licence from the RBI and will commence its operations on May 23, 2017", the company said in a public notice. The service of SFBs (small finance banks) and PBs (payments banks) that started with the nod of Reserve Bank Of India is just to deepen the financial inclusion. "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".
Indian mobile wallet giant Paytm is to open its new Payments Bank on 23 March, joining telco Bharti Airtel as one of the first non-banks to take advantage of the Government's relaxing of restrictions on bank licensing in an effort to boost financial exlusion.