After clinching top slot on UPI network, PhonePe secures $66 Mn from Flipkart

PhonePe

After e-commerce, digital payments has turned out as fierce battle ground for global heavyweights – Alibaba (via Paytm), Google (via Tez), Facebook (via WhatsApp) and Walmart (via PhonePe). To ramp up its stake against well capitalised rivals, Flipkart has infused $66 million (Rs 452 crore) in PhonePe.

This is the first round in the Bengaluru-based company ever since its acquisition by Walmart. With this round, it has amassed about $143 million in total risk capital from Flipkart ever since its acquisition in early 2016.

The proceed will help PhonePe to wide as well as maintain its lead in UPI over rival Paytm.

PhonePe had claimed top spot on the UPI network last month. It claimed 94 million UPI driven transaction in the month of July. PhonePe commanded about 40 per cent of overall UPI transaction executed last month.

As per NPCI data, about 235 million transactions were recorded in July.

With over 3,00,000 merchants on its platform, PhonePe drives about 70 per cent overall merchant transactions on the UPI network. To assist its merchant ecosystem, the company had acquired customer-focused point of sale (PoS) company Zoppr Retail.

PhonePe attributed its reach in merchant ecosystem and NPCI’s mandate to ban payments transfer within same account or UPI ID (where the payer and the payee account are actually the same) as major contribution in its growth.

In March this year, PhonePe had cried foul over Paytm’s claim of higher transactions. It alleged that many Paytm users transferred nominal amount for the sake of driving number of transactions.

With this fresh round, PhonePe would up its ante in overall digital payments space against arch rival Paytm, and yet to be launched WhatsApp Pay. WhatsApp UPI has been delayed owing to regulatory concerns. The central government had asked it to prioritise curbing the fake news menace before launching payments service.

The development was first reported by Mint via paper.vc.

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