One97 Communications, the company that owns Paytm is reportedly eyeing to raise $300-$500 million for the purpose of pushing its online-to-offline (O2O) retail business and get customers to use its platform for making payments.
At present, Paytm is in advanced talks with US-based investors and also its existing shareholder, SoftBank for the latest funding round, which is expected to value the digital payments giant at about $10 billion.
The funds raised through the particular funding round will be directed towards the hyper-local O2O business, with an objective to shore up footfalls for offline stores by offering deals and discounts on Paytm’s app.
The users will pay through QR codes in these stores, and thus, increasing the number of transactions for the company. As of now, the merchants won’t be charged a commission by Paytm. However, they are required to pay a certain fee for logistics and marketing costs.
Paytm founder & CEO Vijay Shekhar Sharma said, “Paytm wants to enable same-city commerce and help restaurants, grocery stores and pharmacies grow their walk-ins through offers and deals. We have already tied up with 4,500-5,000 merchants.”
Paytm’s Payments Bank head, Renu Satti has stepped down from her current role and will be appointed as the COO’s mantle at New Retail. Paytm has spread its arms in various sectors including movie & events ticketing and hotel bookings, among others, to grow its transactions.
Paytm Mall also utilizes the O2O commerce model and will remain separate and target a different sort of use case. While Paytm’s New space is retailing food, groceries and medicines, which are immediate needs, Paytm Mall’s O2O model has centered around collaborations with brand stores for carrying forward deliveries easily.
Paytm is likely to pay attention to in-store commerce through New Retail. Paytm claims it’s on a run-rate of 5 billion transactions and $50-billion gross transaction value.