Prosus, a global consumer internet company and one of the world’s top technology investors, is purchasing BillDesk, a local digital payments company, in a $4.7 billion purchase, one of the largest in the digital payments industry.
Prosus intends to use this acquisition to grow its payments and fintech firm PayU, which operates in more than 20 countries and is one of the largest online payment providers in the world, with a total payment volume (TPV) of $147 billion.
Prosus said in a statement on Tuesday that the deal, which is subject to approval by the Competition Commission of India (CCI), will raise the company’s total investment in Indian technology to above $10 billion.
The move comes at a time when Indian consumers are rapidly adopting fintech services. The Reserve Bank of India (RBI) anticipates more than 200 million new users to switch to digital payments over the next three years, with average annual transactions per capita rising tenfold from 22 to 220. According to a joint research published by EY and IVCA earlier this year, India and China had the highest fintech adoption rates in the world’s emerging countries. As of March 2020, India had an adoption rate of 87 percent, compared to a global average of 64 percent.
BillDesk, which was founded in 2000, has a TPV of over $90 billion in FY21, according to the company’s website. PayU India and BillDesk, two complementary businesses in India’s digital payment industry, intend to handle 4 billion transactions per year, four times PayU’s present volume.
The ecosystem we’re creating with BillDesk gives PayU the scale and development opportunities it needs to be at the forefront of digital payments in India. PayU India’s CEO Anirban Mukherjee stated , “the combination would help us to gain scale, grow market leadership across all payment verticals, and establish a strong presence in the payment value chain supporting merchants across all sectors in the country.
After CitrusPay, Paysense, and Wibmo, PayU has made its fourth fintech acquisition in India in less than five years. “Together, PayU India and BillDesk will be able to meet the changing payments needs of digital consumers, merchants, and government enterprises in India and offer state-of-the-art technology to even more of the excluded sections of society,” the companies stated.
Prosus’s group CEO, Bob van Dijk, stated that regulatory approvals for the purchase should be in place by February 2022.
According to estimates, the Indian fintech sector would develop at a CAGR of 22.7 percent between 2020 and 25. According to recent research by KPMG, local fintech firms received $2 billion in funding in the first half of the calendar year, virtually matching the total investments in the field for the entire year of 2020.
Prosus, one of the world’s top technology investors, has supported several Indian internet companies, including Swiggy, Byju’s, Meesho, and Urban Company.
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