Digital payment platform PhonePe was spun off by India-based e-commerce marketplace Flipkart today with news it is raising $700m in a funding round led by retail group and Flipkart parent Walmart.
The round will also feature additional Flipkart investors, though the company did not disclose their identity. It will value PhonePe at $5.5bn post-money.
Formed within Flipkart, PhonePe is an online platform that allows users to send and receive money through a mobile wallet, in addition to paying for goods in stores, recharging their mobile and digital television credit, paying utility bills, buying gold and making investments.
Flipkart was reportedly in discussions in May 2019 to raise up to $1bn for PhonePe from prospective investors including internet group Tencent and hedge fund manager Tiger Global Management at a valuation of at least $7bn.
Sameer Nigam, PhonePe’s founder and chief executive, said: “Flipkart and PhonePe are already among the more prominent Indian digital platforms with over 250 million users each.
“This partial spinoff gives PhonePe access to dedicated long-term capital to pursue our vision of providing financial inclusion to a billion Indians.”
Flipkart CEO Kalyan Krishnamurthy added: “As Flipkart Commerce continues to grow strongly serving the needs of Indian customers, we are excited at the future prospects of the group.
“This move will help PhonePe maximise its potential as it moves to the next phase of its development, and it will also maximise value creation for Flipkart and our shareholders.”
