Paytm announced that an amount will be received by them from Mountain Capital, one of Tiawan’s MediaTek’s investment funds. The amount has been disclosed by the company for the time being. The amount is predicted to be $60 million(about Rs. 400 crore).
The Economic Times reveals that PayTm has raised the fresh funds at a valuation of about $5 billion.
MediaTek Inc. manufacturers semiconductors and provides system on chips (SoCs) for mobile devices, home entertainment, connectivity and loT products.
Investments till date.
Founded by Vijay Shekhar Sharma in 2010, PayTm has so far raised more than $728 million. Alibaba Groups is the biggest stakeholder in the parent company today with over 40 percent stake in the Noida-based company. ANT Financial, SAIF Partners and Intel Capital are other key investors. Ratan Tata has even shown interest in the company.
Payments, commerce and financial services will be carried out using the fresh capital. The money will also help in expanding and scaling up the business, boosting payments and commerce and building and launching the proposed PayTm Payments Bank.
Sources reveal that PayTm was looking to raise $400 million by June in February this year to help with the launch of PayTm’s new payment business, PayTm Payments Bank. However, PayTm did not confirm this.
Talking about the funds, Vijay Shekar Sharma says ” “India is an important emerging market with immense potential for smartphone devices, mobile payments, commerce, and financial services. MediaTek’s endorsement on Paytm through Mountain Capital further demonstrates its confidence in the proliferation of India’s digital payments and mobile internet ecosystem. For Paytm, our mission is to bring half a billion Indians to the mainstream economy and we are happy to have a long-term partner in the mobile chipset world to join us. India is ripe for its financial services revolution and with the growing penetration of smartphones, we have an opportunity to give a new business model of payment, banking, and financial services combined with online commerce.”
PayTm Payments Bank
Recent reports sugest that PayTm has been divided into two seperate bodies-PayTm E-Commerce Services and PayTm Payments Bank. The director of both companies would be One97 Communicators chief Vijay Shekhar Sharma. This was apparently done so that PayTm’s marketplace could be connected with Alibaba’s when it entered into the Indian market.
The company hinted its plan to merge with Alibaba when it forayed into the Indian market when it stated that it would have a host of sellers from China and Southeast Asia on its platform.
The competition has undoubtedly sped up in the fintech space, with
Snapdeal-owned FreeCharge, which claims to have closed a million daily transactions in February.
A Nelsen study in April this year sugests that FreeCharge’s market share reached 30 percent from a mere 17 percent from last October. The same study sugests that PayTm’s market share went form 35 percent to 40 percent since last October. With this haul, PayTm has taken the game a notch higher in the finctech segment. Last week, a big dog, MobiKwik where MediaTek has invested, also raised $40million from Net 1 UEPS Technologies.