Paytm Mall pivots to build on ONDC as primary focus, explore exports scope

Alibaba and Ant Group exit Paytm Mall

Early investors Alibaba and Ant Group have exited Paytm’s ecommerce venture, Paytm Mall as the company announced a pivot in its strategy.

Paytm E-commerce, the parent company of Paytm Mall announced that it will pivot to Open Network for Digital Commerce (ONDC) as its primary focus and explore opportunities in exports business in place of traditional physical goods e-commerce.

Vijay Shekhar Sharma, founder and CEO of Paytm in a tweet said: “Keeping in mind our attention to building an open platform for e-commerce, our @PaytmMall‘s business now be built on @ONDC_Official. It will be cost effective, scalable and bring even larger impact to small businesses.”

Source in the know shared that both Alibaba and Ant Group did not want to be part of the pivot as e-commerce is a very competitive and a non-core sector for them in India. “eCommerce will require substantial investments and also the space is still evolving, which means that there will be regulatory changes as well. Both the investors have decided to exit,” said the source on condition of anonymity.

The company in a statement said Paytm Mall is confident of its new strategy and roadmap with the continuing support of other existing shareholders. Some of the other investors who continue to be with Paytm Mall include Softbank, Elevation Capital, SAIF among others.

In 2017, Paytm E-Commerce Pvt Ltd had raised around $200 million from China’s Alibaba and SAIF Partners. According to a Reuters report, in 2018 Softbank had invested $400 million that valued the company at $1.9 billion.

On its ONDC foray, the company said that this move enables it to create a long-term sustainable business in partnership with ONDC, which aims to democratize the purchase and sale of goods in the Indian market, driving transparency and digital independence for small businesses in the country.

It may be noted that the publicly listed One 97 Communications Limited (OCL) has no direct or indirect shareholding in Paytm Mall’s parent entity (PEPL). PEPL is not a part of the OCL group, though PEPL uses the Paytm brand and receives services from OCL.

Paytm Mall spokesperson said, “We are set to build on the revolutionary ONDC program by the Government of India to drive online commerce in India. We also plan to explore opportunities in the export market. We are grateful for the support of our investors and look forward to driving sustainable growth.”