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.
Market Overview.
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.
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