Digital payments company Paytm on Monday said it has raised USD 1 billion (over Rs 7,000 crore) in funding from US-based asset management firm T Rowe Price and existing investors including SoftBank and Alibaba to fund expansion plans. This comes at a time when the country's biggest digital payments firm is facing intense competition from Google Pay, Flipkart-owned PhonePe and others.
Paytm said it plans to invest around Rs 10,000 crore (USD 1.4 billion) over the next three years to expand financial services.
"One97 Communications Ltd (OCL), the parent company of Paytm, has announced an equity fundraising from a group of investors, including existing shareholders such as Ant Financial, Softbank Vision Fund, and new investors including funds and accounts advised by T Rowe Price Associates, Inc, among others," a statement said.
Discovery Capital, an existing shareholder of the company, also participated in the round, it added.
According to sources, the fundraising values the company at about USD 16 billion.
As per reports earlier this year, Paytm, which is facing mounting losses, was looking at raising up to USD 2 billion in funding. The company has said it will look at a public listing only after 2021.
Paytm had raised USD 300 million from Warren Buffett’s Berkshire Hathaway in September last year.
Paytm CEO Vijay Shekhar Sharma has reportedly said the fresh round of funding is of USD 1 billion led by T Rowe Price in which Chinese e-commerce major Alibaba's subsidiary Ant Financial pumped in USD 400 million and Softbank USD 200 million, taking the company's valuation at USD 16 billion.
"At Paytm, we are committed to bringing half a billion Indians to the mainstream economy by onboarding them in the formal financial ecosystem. This new investment by our current and new investors is a reaffirmation of our commitment to serve Indians with new age financial services," Sharma said in the statement.
The company said it will invest and support millions of rural Indians towards self-sustainability through job creation but did not offer much details.
OCL posted a loss of Rs 3,959.6 crore in 2018-19 against Rs 1,490 crore a year ago, and its standalone revenue rose marginally to Rs 3,319 crore from Rs 3,229 crore in 2017-18, as per reports.
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