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SoftBank-backed Flipkart on Thursday said it will invest $500 million in its payments arm PhonePe to scale up operations. The commitment is in addition to the $75 million infused by Flipkart in PhonePe since the acquisition in 2015, Flipkart said.
It added that this is one of the largest single investment commitments in the Indian fintech payments space and “is reflective of the opportunities” in the segment.
The announcement comes a day after the Reserve Bank of India said inter-operability of e-wallets will be enabled in phases. Also, in subsequent phases, inter-operability will kick in between wallets and bank accounts through the Unified Payments Interface, the central bank added.
While Flipkart did not specify the time period over which the funds will be infused, PhonePe co-founder and Chief Executive Officer Sameer Nigam said, “This investment will help us maintain the same aggressive growth rate for the next two years”. He added that the investment will be used to scale up PhonePe’s technology platforms and expand merchant network and consumer base rapidly. He also said PhonePe has been growing at over 100 per cent every two months this year.
“Fintech and e-commerce are among the most visible faces of a new digital India that is powered by the youth and technology, and both are set for outstanding growth. PhonePe is a critical part of our overall strategy at Flipkart to build a comprehensive ecosystem for our customers,” Flipkart Group CEO Binny Bansal said.