Fintech giant PhonePe has raised $350 million in a new financing round led by General Atlantic at a pre-money valuation of $12 billion.
The investment marks the first tranche of an up to $1 billion total fundraise that PhonePe commenced in January 2023. Other new marques global and Indian investors have already been signed up for the second tranche, which is expected to close next month, the company said.
The development comes after PhonePe recently announced the change of domicile to India and complete separation from Flipkart.
PhonePe said it plans to use the raised capital to invest in infrastructure, including the development of data centres, and help build financial services offerings at scale in the country.
The company also plans to invest in new businesses, including Insurance, Wealth Management, and Lending.
“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,” said Sameer Nigam, Founder and CEO at PhonePe.
Additionally, The funding will support PhonePe as it seeks to turbo-charge the next wave of growth for UPI payments in India, including UPI lite and Credit on UPI, to enable greater financial inclusion for Indians.
Founded in December 2015, PhonePe claims to have over 400 million registered users and has digitized over 35 million offline merchants spread across Tier 2, 3, and 4 cities and beyond, covering 99% of pin codes in the count.
“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,” said Shantanu Rastogi, Managing Director and Head of India at General Atlantic.