PhonePe, an Indian digital payments app owned by Walmart, announced on Thursday that it raised $350 million in a funding round led by private-equity firm General Atlantic, valuing the company at $12 billion.
According to Venture Intelligence, Indian startups have raised significantly less in funding rounds backed by venture capital firms last year than in 2021. As startups struggle to cut costs and become profitable, they have also been forced to lay off thousands of employees in recent months. PhonePe’s recent fundraising comes after the company was spun off from e-commerce startup Flipkart in December and completes the company’s transition to being fully domiciled in India, which began in 2022.
PhonePe, owned by U.S. retailer Walmart Inc since 2018, announced plans to use the proceeds from its recent funding round to invest in infrastructure and new business ventures, such as insurance, wealth management, and lending, according to CEO and founder Sameer Nigam on Thursday. The company also stated in a statement on January 19 that it will use the funds for developing data centers. Additionally, PhonePe plans to focus on UPI lite and credit on UPI, the company said.
PhonePe, a fintech founded in 2015 by former Flipkart executives Sameer Nigam, Rahul Chari, and Burzin Engineer, has a user base of over 400 million registered users and is the market leader in Unified Payments Interface (UPI) transactions. It holds a 47% market share in terms of monthly UPI volumes.
PhonePe has now reached the status of a decacorn, meaning a startup valued at over $10 billion, joining the ranks of other successful companies like Flipkart (acquired by Walmart), Paytm (which went public last year), Byju’s, and Swiggy. The company’s valuation has now exceeded that of Razorpay, a digital payments and neobanking unicorn that was last valued at around $7.5 billion.
