Flipkart's Binny Bansal to join PhonePe's board following spin-off
Flipkart Co-founder Binny Bansal is slated to join PhonePe's board after its spin-off from the Indian ecommerce giant, the fintech company said on Thursday.
The board will also include PhonePe's co-founders Sameer Nigam and Rahul Chari, as well as a few representatives from Walmart.
The two companies had announced PhonePe's divestiture earlier in the day. Flipkart cited the fintech major's growth momentum and potential as reason for the spin-off, and said that it will also help the startup gain access to dedicated capital.
Flipkart will retain its majority shareholding in PhonePe — around 87 percent — while its parent company Walmart will hold around 10 percent.
The partial divestiture helped PhonePe raise $700 million in primary capital, at a post-money valuation of $5.5 billion. It also gives the company more autonomy over its operations, including the power to create equity incentives for its employees.
In November, the startup said it had crossed 250 million registered users. It reported over 100 monthly active users (MAU) and 2.3 billion app sessions in October, and set a target of crossing 500 million registered users by December 2022.
PhonePe competes with the likes of Paytm, MobiKwik, and Google Pay, and allows users to send and receive money, recharge mobile, and make utility payments, as well as buy gold. It recently launched mutual funds and insurance financial products like tax-saving funds, liquid funds, international travel insurance, as well as Corona Care — a dedicated insurance product for the COVID-19 pandemic.
PhonePe reported a 2X growth in losses in FY19 at Rs 1,907 crore, while its revenue grew 5X between FY18 and FY19 to Rs 245.8 crore.
Fintech companies have enjoyed a surge in user base during the COVID-19 pandemic, thanks in part to contactless payments, and increase in online shopping for essentials during the lockdown.