News Update

Payment aggregator license secured by PhonePe as total payment value reaches $1 trillion

• ByStartupStory     |    March 11, 2023

PhonePe, a payments app backed by Walmart, has announced that its annualized Total Payment Value (TPV) has reached $1 trillion (equivalent to Rs 84 lakh crore), driven by transactions made through UPI.

According to a statement released by the company, PhonePe has received in-principle approval from the Reserve Bank of India (RBI) for its Payments Aggregator license. The firm plans to leverage this license to expand its payment solutions and reach out to small businesses in order to further increase its scale.

PhonePe has also announced that it intends to make substantial investments in new ventures such as insurance and wealth management.

According to Sonika Chandra, who is the Head of Consumer Business at PhonePe, “the company’s emphasis on streamlining the customer experience and providing speedy, secure, and dependable transactions has enabled it to gain the confidence of millions of users in India”.

PhonePe has a presence in more than 35 million offline merchants in Tier II cities and beyond. The company states that it has captured over 50% of the market share in terms of UPI payments by value in India. Google Pay, Paytm, and Amazon Pay are among the other competitors in the UPI sector.

Established in 2015, PhonePe was spun off from its parent company Flipkart Group in 2020. Following this, the company received a commitment of $700 million from Walmart, which is the largest shareholder of Flipkart, across multiple installments. Additionally, in January, PhonePe raised $350 million from General Atlantic.

In February, PhonePe secured $100 million in funding from existing investors Tiger Global, Ribbit Capital, and TVS Capital Funds. The company was valued at $12 billion during this funding round.

PhonePe shifted its domicile from Singapore to India in October, which resulted in its investors incurring Rs 8000 crore in taxes. The company is reportedly considering the possibility of going public, although the founders have not established a firm timeline for this.

PhonePe asserts that it has a total registered user base of approximately 450 million and is responsible for processing 45% of transactions on the Bharat Bill Pay System (BBPS).

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