UBS in talks to invest $400mn in Paytm
UBS Group AG is considering a major investment in India’s e-commerce payment system and fintech company, Paytm, acc ording to recent news reports.
The Uttar Pradesh-based enterprise which is currently Asia’s most successful start-up is in talks with UBS as they agree on a Paytm stock purchase, sources told Tech In Asia. Both Bloomberg and Finextra have also reported on the possible collaboration.
If successful, the partnership with Paytm will see the Zürich and Basel-headquartered investment banking giant enter the growing digital payments market. Although nothing has been confirmed, a deal could be reached in weeks, say insiders.
Founded in 2010 as a top-up service for mobile phones, Paytm has grown into one of India’s biggest payments apps. It currently provides services including money transfer, bill payments and merchant and personal loans.
The company has capitalised on the ease-of-use aspect of mobile transactions, enabling its customers to pay, receive and shop with their smartphones at no extra cost. Users scan the recipient's QR code or enter their mobile number in the 'Pay' option in the Paytm app to manage instant virtual payments.
Paytm has been met with extraordinary success in the marketplace. The company raised $1bn in November 2019 and had a $16bn valuation by the US-based asset management firm T. Rowe Price.
The pandemic has contributed to Paytm’s success, says the company’s CEO and founder Vijay Shekhar Sharma. He believes the company is set to report profits in 2021 following the adoption upsurge of digital payment services of Paytm’s services in the wake of COVID-19.
He reportedly told Bloomberg, “We could very well break even this year, we will start making money. I was surprised by the opportunity of monetisation in 2020 during the pandemic, not just by our wealth accounts but also by lending
Payment startup Mollie raises US$800m at a $6.5bn valuation
Mollie, one of the fastest-growing payment processors within Europe, today announced it has raised US$800m in a Series C funding round, now valuing the company at $6.5bn. The valuation, based on Dealroom data, makes Mollie the third most valuable privately-held European fintech behind Klarna and Checkout.com.
Blackstone Growth (BXG), Blackstone’s growth equity investing business, led the investment and included participation from EQT Growth, General Atlantic, HMI Capital and Alkeon Capital. TCV who led the Series B investment in September 2020 also participated in the funding round.
According to the company, the funding will fuel Mollie’s international expansion, team scaling, and continued investment in product and engineering.
“There’s something very special about Mollie. In the three months since I joined the team we’ve achieved so much: making preparations for a full launch in the UK, driving 600% growth in Germany and hiring an impressive set of team members and executives,” said Shane Happach, CEO, Mollie. “Over the past months, Mollie has been receiving a remarkable amount of interest from some of the world’s foremost fintech investors. In bringing on BXG, we believe we have an investor who can help Mollie in our next phase of growth. The involvement of our new group of investors demonstrates confidence in Mollie’s growth, strategy and product set.”
The Amsterdam-based business was launched in 2004, and is one of the largest PSPs in Europe. Today, it serves more than 120,000 monthly active merchants of all sizes across the continent. During 2020, Mollie processed more than 10 billion Euros in transactions and is on track to handle more than 20 billion Euros during 2021.
“Mollie is one of Europe’s most exciting high-growth businesses and is at the forefront of enabling next-generation payments for online SMEs across Europe. We are excited to partner with Mollie’s fantastic team and look forward to leveraging Blackstone’s capital, expertise and global network to unlock the company’s next phase of growth,” said Paul Morrissey, who leads European investing for Blackstone Growth. “This investment underlines Blackstone’s confidence in Europe as a place for high-growth companies to thrive.”
In Europe, FinTech app usage grew by 72% directly after the pandemic outbreak, while the top seven digital banks in the US grew their cumulative user base by 39% throughout the year. Competition in payments has grown over the past few years with fintech players like Stripe, Square and Netherlands-based Adyen all competing for a bigger share of the market.
Unlike its American rivals, Mollie says it mainly focuses on transactions with small businesses in Europe. Shane Happach, CEO of Mollie said: “A lot of the bigger players in online payments come out of the US, like PayPal,”. Adding that even Visa and Mastercard are US companies.
“A lot of investors don’t have a bet on Europe,” Happach said. “Mollie’s one of those unique assets that offers exposure.