Flipkart and PhonePe announced the full ownership separation of PhonePe, one of India’s largest digital payments platforms. Establishing these businesses as individual entities will allow both to chart their own growth paths, as they continue building offerings that provide access and inclusion for Indians.
The PhonePe Group was acquired by the Flipkart Group in 2016 and today is among India’s largest digital payments platforms. The company builds products and offerings tailored to the Indian market, and with over 400 million registered users. Since its launch, PhonePe has successfully digitised more than 35 million offline merchants spread across Tier 2, 3, 4 cities and beyond, covering 99% of pin codes in the country.
Setting up these businesses as separate entities will also provide value and create new opportunities for investors to participate in the Indian tech ecosystem– helping unlock and maximise enterprise value for shareholders of the two companies.
Sameer Nigam, Founder and CEO at PhonePe, said, “Flipkart and PhonePe are proud, homegrown Indian brands with a user base upwards of 400 million each. We are looking forward to the next phase of our growth as we invest in new businesses– like insurance, wealth management and lending, while also enabling the next wave of growth for UPI payments in India. This will help propel our vision to provide billions of Indians with financial inclusion.”
Kalyan Krishnamurthy, CEO of Flipkart Group, said, “The Flipkart Group has developed many successful entrepreneurs and seen impactful businesses started by former employees. We are proud to see PhonePe grow and thrive as a successful organization in its own right. We are confident PhonePe will continue to scale and achieve its vision of providing financial inclusion to millions of Indians. Flipkart stays committed to its purpose to empower every Indian’s dream by delivering value through innovation in technology and commerce while helping small businesses connect to pan-India markets.”
As part of this transaction, existing Flipkart Singapore and PhonePe Singapore shareholders, led by Walmart, have purchased shares directly in PhonePe India. This completes the move to make PhonePe a fully India-domiciled company, a process that started earlier this year. Walmart will remain the majority shareholder of both business groups.