Alibaba and Ant Financial — the eCommerce firm’s financial services affiliate — have moved to make a second big buy into Paytm, an India-based mobile payments and eCommerce firm. This follows an undisclosed investment by Alibaba and Ant in Paytm earlier this year — funding that reportedly left the Indian company with a valuation of around $1 billion.
Paytm’s business model is often compared to that of Alibaba’s, though at an earlier and less developed level. The firm’s range of services include a mobile wallet app, online recharge of pay cards and shopping services.
Paytm’s mobile wallet has a reported 100 million users and logs more than 75 million transactions each month.
Once again, the details of the deal have not been officially disclosed; though according to India’s Economic Times, Alibaba will be buying 20 percent of Paytm for $680 million. Ant Financial’s stake, on the other hand, will decline from 25 percent to 20 percent.
Vijay Shekhar Sharma, founder and CEO of Paytm, said the company is looking “to bring half a billion Indians to the mainstream economy and help millions of small businesses leverage this large mCommerce opportunity.”
India of late has been an increasingly large and attractive target for U.S. tech investors, particularly as economic conditions in China have made it a less conducive environment for growth. Alibaba apparently sees a similar opportunity.
“India is an important emerging market with strong eCommerce potential, and we look forward to partnering with Paytm to deliver innovative products and services to consumers … This investment will further expand Alibaba Group’s global footprint to India’s thriving mobile commerce market,” Alibaba CEO Daniel Zhang said in a statement.
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