Ant Financial and SoftBank have expressed interest in backing a $1.2bn funding round for Paytm Money, the wealth management subsidiary of their portfolio company One97 Communications.

India-based wealth management platform Paytm Money plans to raise up to $1.2bn from investors including financial services provider Ant Financial and telecommunications and internet conglomerate SoftBank, Business Standard reported yesterday.

The round would value Paytm Money at $5bn and could close within the next three months. It would make the entity the third unicorn formed by One97 Communications, which also owns digital payment services provider Paytm and e-commerce platform Paytm Mall.

Launched in September 2018, Paytm Money enables users to invest in mutual funds. It will use the capital to expand its offering in the mutual funds area, as well as entering the insurance and financial services segments.

Once closed, the round will represent the first external cash injection for Paytm Money, which is currently operating through a $10m internal commitment from its parent company.

Paytm has reportedly set aside roughly $150m to acquire an online insurance marketplace, and any such acquired company would likely be merged with Paytm Money. Rumours in June 2018 suggested it had approached Coverfox, whose investors include insurance provider Transamerica.

One97’s shareholders include SoftBank, which currently holds a 19% stake in having paid $1.4bn for a 20% share through a primary and secondary transaction in May 2017.

Ant Financial and its parent company, e-commerce group Alibaba, jointly own 38% of the company after buying out Reliance Capital, a division of conglomerate Reliance Industries, as well as Sapphire Ventures and Saama Capital, in March 2017.

Other investors in One97 include fabless semiconductor producer MediaTek, which provided $60m of funding for the company in 2016, as well as private equity firms Berkshire Hathaway and SAIF Partners.

Thierry Heles

Thierry Heles is the former editor-at-large of Global University Venturing and Global Corporate Venturing, and was the producer and host of the Beyond the Breakthrough podcast until December 2024.