Payments company PayU plans to go public in India in the second half of next year.
The company’s half-year earnings show that PayU’s payments operation in India enjoyed a 15% growth in revenue for that period, reaching $211 million.
The news follows a report from October that PayU was seeking regulatory approval for an initial public offering (IPO) in India worth at least $500 million, a move that could value the company at between $5 billion and $7 billion.
Prosus announced in August it was selling the bulk of its worldwide business to Rapyd for $610 million so it could spend more time focusing on the Indian payment and FinTech space. The company has said it has upwards of 450,000 merchants and two million credit customers in India.
“Innovation and progressive regulation are driving rapid change within the digital payments industry in India, and we see many new opportunities to further expand our business there,” Bob van Dijk, Prosus’ then-CEO, said at the time. “As one of the fastest-growing major economies in the world, we strongly believe in digital India and are excited about the next phase of growth for PayU in India.”
The planned IPO is happening as India’s younger, tech-savvy population continues its shift away from cash to other payment methods. As noted here, Indian citizens have long been accustomed to using their mobile phones to pay bills, bank and pay merchants online and in-store using one of many digital wallets.
India also has one of the world’s fastest-growing eCommerce markets, with annual online sales that exceeded $67 billion in 2021. Close to 90% of its adult residents use mobile wallets, while 833.7 million people in India are connected to the internet.
PYMNTS’ Intelligence has shown that more than half of consumers in India paid for their last retail purchase through UPI.
“UPI is more popular for digital retail purchases: 55% of India’s consumers paid for their most recent digital retail purchase with UPI, while 37% did the same for in-store retail purchases,” PYMNTS wrote in August. “UPI is also the preferred payment method when purchasing retail products, as half of surveyed consumers identified UPI as their preference.”