PhonePe raises $200 Mn in additional funding from Walmart

Fintech platform PhonePe has raised an additional $200 million in primary capital from Walmart, which continues as a majority investor of the Bengaluru-based company.

With this tranche, the company has raised $650 million from several global investors, including Ribbit Capital, Tiger Global, and TVS Capital Funds since January. The latest funding comes as a part of PhonePe’s ongoing fundraise of up to $1 billion in capital, following its domicile shift to India last year. The company expects further investments, which will be announced in due course.

Like previous tranches, PhonePe has raised the new money at a pre-money valuation of $12 billion.

PhonePe plans to deploy these funds to build and scale new businesses like insurance, wealth management, lending, stockbroking, ONDC-based shopping and account aggregators, the company said in a press release. The capital will also help PhonePe turbo-charge the next wave of growth for UPI payments in India, including UPI lite and Credit on UPI.

With over 400 million registered users, PhonePe claims to hit an annualized TPV (Total payment value) run rate of $1 trillion (Rs 84 lakh crore approximately). It also leads the UPI space where it holds over 50% market share by value. Its competitors Google Pay and Paytm are far behind in terms of transaction volume and value.

For the fiscal year ending on March 31, 2022, PhonePe’s revenue spiked 2.4X to Rs 1,646 crore from Rs 690 crore in FY21. The firm’s losses grew only 16.5% to Rs 2,014 crore during the last fiscal year. The company has further improved its balance sheet and has recorded Rs 1,913 crore in revenue in the first nine months (January to September) of 2022, according to its valuation report accessed through a regulatory filing.

At this rate, PhonePe seems likely to surpass its FY22 numbers in the fiscal year FY23.