To counter Paytm, Flipkart-owned PhonePe in talks to raise more funds

Given a current boom in Indian payment space, Flipkart-owned PhonePe is in talks with a couple of investors to raise fresh capital.

The payment firm is looking to raise up to $1 billion to maintain the lead in payment space, said a Livemint report quoting two sources close the development.

Last week, PhonePe has raised $175 million from Walmart, as part of its $500 million commitment, they added. The US-based retailer has said that the investment will be to consolidate its position in the space. It reportedly is also looking to bring more strategic partners on board.

However, the report did not mention the investors involved.

Earlier, PhonePe talks to raise capital with search engine Google collapsed. The fresh capital will help Flipkart payment arm to expand further its operations.

PhonePe claims to have witnessed a 20X growth in the past six months as far as the offline transaction is concerned. It processed 2 million transactions via its offline organised outlets and aims to reach 10 million figure by December, this year.

In the digital payment space, PhonePe, GooglePay and  Paytm are fighting for the crown. Till June, Alibaba-backed Paytm claims to have around 300 million registered users whereas PhonePe has 100 million users.

While Paytm had claimed $29 billion GTV through wallets, UPI, and bank transfers, PhonePe announced that it had crossed $20 billion annualised total payments volume (TPV).

The average transaction value on the platform varies between Rs 1800-2000 which shows that users don’t shy in performing high-value transactions. Paytm doesn’t give ATV figure which has been a matter of contentions for PhonePe.

Google pay too has been gaining ground in the country as a third front. It has claimed to hit 25 million monthly active users mark in one year. Within one year of launch, Google’s payments platform also claims to have carried out about 860 million transactions from those users.