The founder of Indian eCommerce and payments firm Paytm is now reportedly also its largest shareholder.
Analysts tell the news outlet that the move is happening as Sharma is moving to simplify the company’s ownership structure, while also dealing with worries by the Reserve Bank of India (RBI) about Chinese ownership of Indian FinTechs.
“The government and RBI both were concerned about Chinese stakes in Indian fintechs, so the point was to reduce the stake of the Chinese companies in Paytm,” a Mumbai-based analyst told Reuters. They asked not to be named as they were not permitted to talk to the press.
The stake Sharma is buying will reduce Ant’s ownership in the company to 13.5%.
Another Chinese company, Alibaba, sold half of its stake in Paytm in January. The following month saw Paytm buoyed when India’s government — driven by worsening relations with China — banned 138 betting and gaming apps and 94 credit services.
The ban was seen as good news for Paytm, as many of the affected companies included its competitors.
Meanwhile, Paytm last month reported 39% revenue growth in its quarterly earnings report, a trend the company attributed to increases in gross merchandise value (GMV), merchant subscription revenues and loans distributed through its platform.
“As mobile payments are becoming more mainstream, our merchants are seeking more technology and the demand for products such as Soundbox and Card machine is rising,” Paytm said in a news release.
The company’s loan distribution business revenue climbed 93% year over year as Paytm continued to scale the business.
“Our payments business is our acquisition engine, which helps us to get insights about customers’ behavior and enables us to distribute suitable credit products to them,” Paytm said in the release. “As we have mentioned before, we continue to work with our partners to ensure superior credit quality for loans distributed through us.”
Overall, the company said the growth drivers for its business include the increasing adoption of technology by merchants in India, innovation in the payments sector and the huge opportunity for growth of loan distribution offerings.