Paytm, the digital payments startup headquartered in India, has raised $1.4 billion in funding from Softbank Group.
According to report in Bloomberg, the latest funding is the largest from a single investor for India’s technology sector. Softbank made the investment in One97 Communications, which operates the Paytm payment service. The funding will be used to expand the user base, which currently stands at 220 million, and to build more financial services products.
The company told Bloomberg in an email that Softbank will join Alibaba, the Chinese eCommerce giant, as a major shareholder in the company and will get a seat on the board.
“We believe we have a great opportunity to bring financial inclusion to half a billion Indians,” One97 Founder and Chief Executive Vijay Sharma said in the statement to Bloomberg. The founder of the leading digital payment company in India noted the investment from Softbank is an endorsement of the company and its prospects. People familiar with the matter told Bloomberg the investment values One97 at $7 billion.
“India has presented us with the world’s largest opportunity in terms of financial services, and we are confident its market will grow exponentially over the next decade,” said Eric Jing, chief executive officer of Ant Financial, the financial arm of Alibaba, which has a 40 percent stake in One97.
Paytm has been growing big-time ever since the government of India took high denomination currency out of the system and vowed to move the country toward a cashless economy. Paytm has been expanding beyond payments, including movie ticket and rail ticket booking and digital gold trading, noted the report. Bloomberg added that during the next three to five years, Paytm will pour $1.6 billion into doubling its user base and is aiming to help half a billion people in India use digital payments.