Digital payments firm Phonepe on Friday said that it has raised $200 million from its largest shareholder Walmart, at a pre-money valuation of $12 billion. The funding is part of Phonepe’s ongoing fundraise of up to $1 billion, following its shift to India from Singapore last year, the company said in a statement. With this tranche, the company has raised $650 million from several leading global investors.
With the latest round, Phonepe’s $12 billion valuation far exceeds rival Paytm’s $4.5 billion. In the past two months, Phonepe has raised $350 million from private equity firm General Atlantic, and $100 million from Ribbit Capital, Tiger Global and TVS Capital Funds. Phonepe also said that it expects further investments which will be announced in due course.
“’We would like to thank Walmart, our majority investor, for their continued support of our long-term aspirations. We are excited about the next phase of our growth as we build new offerings for Indian consumers and merchants, along with enabling financial inclusion across the nation,” Sameer Nigam, CEO and Founder of PhonePe, said in a statement.
The funding will help facilitate Phonepe’s growth in India’s UPI payments space, including “UPI lite and Credit on UPI”. Phonepe will deploy these funds to build and scale news businesses like insurance, wealth management, lending, stockbroking, ONDC-based shopping and account aggregators, the company maintained.
Walmart, which had acquired a majority share in PhonePe in 2018, will continue to hold majority stake in the company. “India is one of the world’s most digital, dynamic and fastest growing economies, and we are pleased to have the opportunity to continue to support PhonePe,” said Judith McKenna, President and CEO, Walmart International.
Phonepe had, earlier last year, separated from Flipkart, making the digital payments firm a fully India-domiciled company. It had then also shifted its registered headquarters from Singapore to India. “Establishing these businesses as individual entities will allow both to chart their own growth paths, as they continue building industry-leading offerings that provide access and inclusion for Indians,” the company had said in a statement.
The funding is despite the funding winter that has intensified recently due to global uncertainty. The recent collapse of US-based Silicon Valley Bank (SVB), which mainly funded startups, has forced investors, banks and startup founders to reevaluate their long-term plans and working mechanism. The digital payments space is still being lucrative due to the popularity of online payments across the country.