Indian Digital Payments Giant Paytm Files for $2.2 Billion IPO

Digital payments giant Paytm plans to raise $2.2 billion as an initial public offering, a valuable start, according to a draft paper submitted to the country’s market regulator on Friday. The Noida-based company – backed by Alibaba (which owns 36% of PTM’s payments), Berkshire Hathaway, and Softbank (on the other hand, about 18% stake) – (PDF) said it would issue $1.1 billion in new shares and offer sales worth $1.1 billion. 

Paytm, which recently had the most valuable launch in India, said it could rise to $268 million in the pre-IPO round. TechCrunch reported earlier this month that Paytm had negotiated with Goldman Sachs and Fidelity to raise a pre-IPO round. Competing with PhonePay and Google Pay in the world’s second-largest Internet market, the startup plans to use its $577 million payments capital to further expand its payment service offer and use about $269 million to enter new ventures and explore acquisition opportunities.

Paytm, which was launched in 2009 to make it easier for users to make digital payments from their phones and provide top-notch credit support, has expanded over a wide range of services over the past decade. Today it operates a payment gateway, e-commerce marketplace, and ticket bookings and sells insurance and digital gold. Paytm is a market leader in several of the segments it manages. The initial platform, officially known as One7 Communications and the latest $1 billion, has gained 333 million users, including 114.3 million annual transactions and 21 million merchants, according to a study released today.

Led by Vijay Shekhar Sharma, Paytm has established itself as a “payment-led supra, through which we deliver innovative and intuitive digital products and services to our consumers.” View Paytm numbers shared with market regulators on Friday. Image Credit: Paytm “We offer our customers a wide selection of payments in the Paytm app, including (i) Paytm Payment Instruments, which allows them to purchase digital wallets, sub-wallets, bank accounts, buy now, pay later and manage assets and (ii) major third parties instruments, such as debit and credit cards and net banking, “