Since its launch in 2010, Paytm has been striving to become one of the biggest players in India’s eCommerce industry.
The Noida-based company—which boasts around 350 million registered users—is currently valued at around $16 billion, making it India’s highest-valued startup. Last year, it raised $1 billion in a funding round led by a group of existing investors including SoftBank’s Vision Fund and China’s Ant Financial Services.
Paytm has worked to make financial services more readily available throughout India. Its payments app is based on the UPI platform by the National Payments Corporation of India, and earlier this year its business app added a comprehensive QR code system operating on multiple platforms so it could accept payments from various sources. Last month, the company expanded its Paytm Postpaid program so it can be used by such places as small convenience shops and chain stores, allowing users to buy groceries, milk, and other home essentials. In addition, it extended its app to cover various bill payment facilities to help offer relief during the COVID-19 pandemic.
Now it aims to bring insurance services to more people in India via its acquisition of insurance firm Raheja QBE. Paytm is making the $76 million all-cash deal along with its co-founder and chief executive, Vijay Shekhar Sharma, who is buying Raheja through QorQl Pvt., a firm in which he owns majority stake (Paytm owns the remaining stake).
Raheja QBE offers health, home and auto insurance, as well as protection on commercial properties and workplace injuries. It has over 41,000 customers and sold 69,000 new policies in the financial year that ended in March. However, only a fraction of the nation’s 1.3 billion people currently has access to insurance. In fact, data shows that insurance products have reached less than 3 percent of the population as of 2017.
Paytm is hoping to change that. Raheja QBE’s “strong management team will help us accelerate our journey of taking insurance to the large population of India with the aim to create a tech-driven, multi-channel general insurance company with innovative and affordable insurance products,” said Amit Nayyar, president of Paytm, in a statement.
