Paytm, the eCommerce payment system and financial technology company based in India, has announced plans to purchase Raheja QBE General Insurance Co. Ltd.
“It is an important milestone in Paytm’s financial services journey, and we are very excited to welcome Raheja QBE General Insurance into the Paytm family,” said Paytm President Amit Nayyar in a statement. “Its strong management team will help us accelerate our journey of taking insurance to the large population of India with the aim to create a tech-driven, multi-channel general insurance company with innovative and affordable insurance products.”
The purchase price was not disclosed. Paytm said it is in the process of acquiring a 100 percent stake in the company. Today, the Mumbai-based insurer is owned by the building materials company Prism Johnson at 51 percent and 49 percent by QBE Australia, one of the country’s largest global insurers.
The goal of the purchase is to take insurance products to the grassroots of India, Paytm wrote.
QBE Australia Pacific CEO Vivek Bhatia said the announcement marks a continuation of QBE’s strategy to simplify its business.
The deal must be approved by the Insurance Regulatory and Development Authority of India.
As PYMNTS reported, last month Paytm expanded its Paytm Postpaid program so that its payments app can be used in convenience shops and chain stores, along with the possibility of an increased credit limit.
Paytm added that the service will be available to buy groceries, milk, and other home essentials from neighborhood stores and other popular retail destinations.
Last fall, Paytm had a deal to secure $2 billion in a new financing round in preparation for competition with other payment services, including Facebook’s Libra and Flipkart’s PhonePe.
The funding was to come from Ant Financial and Japan’s SoftBank Group, among other investors and divided into equal parts between the company’s equity and debt and brings Paytm’s valuation to around $16 billion.
But the deal collapsed, the India Times reported, and Paytm hired former Coverfox CEO Premanshu Singh as senior vice president and the head of its insurance business.