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PhonePe seeks to raise $1bn

December 09, 2022

PhonePe seeks to raise $1bn
Even as global funding dries up for start-ups, Walmart Inc-owned digital payments firm PhonePe is seeking to raise about $1 billion from General Atlantic and existing investors, including Tiger Global Management, Qatar Investment Authority, and Microsoft Corp, quoting sources privy to the development Bloomberg reported.

According the report, the all-equity round is expected to close in the next two weeks and may take Bangalore-headquartered PhonePe’s valuation close to $13 billion, including new capital invested, said the sources.

The valuation catapults PhonePe among India’s most valuable brands in a digital payments market forecast by Boston Consulting Group to triple in size to $10 trillion by 2026. It is in talks with SoftBank Group Corp.’s Vision Fund, an investor in PhonePe’s parent entity Flipkart, although Walmart will remain top investor, the people said. Forced to go on the defensive due to its portfolio losses, SoftBank has cut its investments sharply this year.

The new valuation would give PhonePe a higher valuation than arch-rival Paytm, whose market capitalisation has dropped to $4 billion — down about 70 per cent from its market debut last year.

Competition is escalating between PhonePe, Paytm, Alphabet Inc.’s Google Pay and Amazon.com Inc.’s Amazon Pay, as well as a raft of startups looking to capitalize on India’s fast-digitizing economy. SoftBank also backs Paytm.

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