PhonePe, a leading fintech platform in India, has raised $350 million in funding from General Atlantic at a valuation of $12 billion, according to the announcement from the company.
PhonePe also recently announced a full separation from the Flipkart Group. After a partial separation in December 2020, a number of Flipkart shareholders, led by Walmart, acquired shares in the recent separation last month.
This move will allow PhonePe and Flipkart to chart their own growth paths, build their businesses independently, and help unlock and maximize enterprise value for shareholders of the two companies.
General Atlantic is a global growth equity firm that manages over $73 billion in assets as of September 30, 2022. They have more than 215 investment professionals based in various locations such as New York, Amsterdam, Beijing, Hong Kong, Jakarta, London, Mexico City, Miami, Mumbai, Munich, Palo Alto, São Paulo, Shanghai, Singapore, Stamford, and Tel Aviv.
PhonePe plans to deploy the new funds in India
This is the first part of a $1 billion fundraising round that PhonePe started in January 2023. Other new global and Indian investors will be participating in the second tranche, which is set to close next month. This fundraising follows PhonePe’s recent move to change its domicile to India and fully separate from Flipkart.
PhonePe plans to use the new funding to invest in infrastructure, including data centers and financial services offerings in India. The company also plans to invest in new businesses, such as Insurance, Wealth Management, and Lending.
The funding will support PhonePe’s efforts to accelerate the next wave of growth for UPI payments in India, including UPI lite and Credit on UPI, which will enable greater financial inclusion for Indians.
Founded in December 2015, PhonePe has grown into a successful home-grown company, powered by India’s emerging digital ecosystem. With over 400 million registered users, which is more than one in four Indians, PhonePe has successfully digitized over 35 million offline merchants in Tier 2, 3, and 4 cities and beyond, covering 99% of pin codes in the country.
Speaking on the announcement, Sameer Nigam, Founder and CEO at PhonePe, said:
I would like to thank General Atlantic and all our existing and new investors for the trust they have placed in us. PhonePe is proud to help lead India’s country-wide digitization efforts and believes that this powerful public-private collaboration has made the Indian digital ecosystem a global exemplar.
We are an Indian company, built by Indians, and our latest fundraise will help us further accelerate the Government of India’s vision of digital financial inclusion for all. We look forward to delivering the next phase of our growth by investing in new business verticals like Insurance, Wealth Management and Lending, while also facilitating the next wave of growth for UPI payments in India.
Commenting on the occasion, Shantanu Rastogi, Managing Director and Head of India at General Atlantic, said:
Sameer, Rahul and the PhonePe management team have pursued a clear mission to drive payments digitalization and significantly broaden access to financial tools for the people of India. They remain focused on driving adoption of inclusive products developed on the open API based ‘India stack.’
This vision is aligned with General Atlantic’s longstanding commitment to backing high-growth businesses focused on inclusion and empowerment. We are excited to partner with the PhonePe team to help enable the next generation of digital innovation in India.