Alibaba’s Ant financial services, which had initially invested a sum of $500 Million into Paytm, has now reportedly upped its stake to 40% by pumping in a fresh $680 Million in a new round. Reuters reports that the amount could be in the vicinity of $700 Million.
If the proposed funding amount is even close to what’s being reported, this would zoom up Paytm’s valuation to over $4 Billion, making it one of India’s most valued startups in the current scenario.
Earlier in February this year, Ant Financial Services Group, an Alibaba Group Financial affiliate, had announced today that it will take a 25 percent stake in PayTm’s parent, One97 Communications. The company said that this investment was a part of a strategic agreement between the two brands.
Similar to its February investment terms, this investment too is considered strategic in nature, with Alibaba looking to expand its reach in the Indian market through Paytm.
Interestingly though, if these numbers and reports are true, this would leave both Alibaba and Ant Financial services with a stake of 20% each in Paytm, virtually giving China’s largest mobile payments and services provider a whopping 40% stake into India’s largest payments service provider. PayTM also received a digital banking license from RBI last month.
The companies said in a joint statement,
The fresh capital infusion will allow Paytm to achieve scale, develop its vibrant mobile commerce and payment ecosystem in India, and invest in marketing, technology and talent. This transaction further demonstrates the commitment of Alibaba, the largest online and mobile commerce company in the world in terms of gross merchandise volume, to continue to internationalize its ecommerce business.
Alibaba. via these strategic investments and other schemes has been quietly making deep inroads into the Indian market. Paytm recently announced plans to bring over 100,000 Chinese sellers on its platform, virtually opening massive gates to an Indian market, which had largely been a nascent territory for China’s burgeoning e-commerce companies.
