Indian Economy News

PhonePe gets US$ 28 million funding from parent Flipkart

  • IBEF
  • April 28, 2020

PhonePe’s Singapore entity PhonePe Pte Ltd has received an investment of US$ 28 million from parent Flipkart, according to the regulatory filings by the company. This is the first round of funding raised by the company this financial year.

Company plans to raise around US$ 100 million in 2020.

These fresh funds of US$ 28 million comes just two months after the Bengaluru-based payments platform had received Rs 427 crore (US$ 60.58 million) from its Singapore entity, PhonePe Private Limited.

Several funds were raised by the company last year, around Rs 585.66 crore (US$ 83.23 million) from its Singapore-based parent in December and another Rs 698 crore (US$ 99.02 million) in July, last year.

PhonePe co-founder and CEO, Mr Sameer Nigam said that the payments platform plans to file IPO in 2023 and reach profitability by 2022.

Although, current situation around covid-19 has affected the digital payments industry, with PhonePe also witnessing a decline of 35 per cent on overall transactions on its platform.

However, PhonePe plans not to stop investing in advertising and has recently signed in with Doordarshan and other regional channels to run brand advertisements.

The company has relied on its O2O (Offline-to-Online) strategy which it started focussing on in 2018 and is providing help to users understand which kirana stores are open and delivering, in the current lockdown.

According to the company it will start monetising on its O2O strategy as well as look at revenue streams from Financial Services, commissions from its in-app ‘Switch’ platform as well as Advertising on the app in the coming months as it looks to become profitable.

The company is also working with delivery fleets like Swiggy Genie to meet its offline network stores and deliver goods to customers, during the current situation.

Currently, the Flipkart-owned payments entity also said that it will end this financial year with more than 275 million users and gather another 220 million in the next two years.

 

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

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