The proposed acquisition will see PayU, the payments and
fintech business of Prosus which operates in more than 20 high-growth markets,
become one of the leading online payment providers globally by total payment
volume (TPV).
PayU focuses on high-growth markets and operates across
three distinct businesses:
- Payments for domestic and cross border transactions. For the financial year ended March 2021, PayU reported a strong performance, increasing TPV 51% year-on-year to US$55bn across India, Latin America and EMEA;
- Credit solutions for consumers and small businesses. Licensed in India and distribution agreements in five other markets; and
- Strategic investments in innovative fintech companies. Including Remitly in the US and the building of a full financial services ecosystem in India.
BillDesk, founded in 2000, is an Indian success story and
one of the leading payment businesses in the country.
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, while adhering to the regulatory environment in
India and delivering robust consumer protection.
The transaction, which is subject to approval from the
Competition Commission of India, builds on previous successful acquisitions by
PayU in India, including CitrusPay, Paysense and Wibmo.
Bob van Dijk, Group CEO of Prosus, said: “We have a long and
deep relationship with India, having supported and partnered with some of its
most dynamic entrepreneurs and new tech businesses since 2005. We’ve invested
close to US$6 billion in Indian tech to date, and this deal will see that
increase to more than US$10 billion.
“BillDesk exemplifies the ambition and expertise of Indian
entrepreneurs, who are among the best in the world, with exceptional abilities
to build products and services and understand scale and value. This is critical
in a country as vast as India.
“Our announcement today reflects Prosus’s desire to build
valuable, global consumer internet businesses that provide useful products and
services for millions of people in their everyday lives. Along with
classifieds, food delivery, and education technology, payments and fintech is a
core segment for Prosus, and India remains our number one investment destination.”
Laurent Le Moal, CEO of PayU, said: “We believe this
transaction will stimulate both innovation and competition within India’s
digital payments industry. This will not only help to strengthen India’s
digital economy, but also bring financial services to those who may have
historically been excluded. This ambition is fully aligned with the Government
of India’s vision of ‘Digital India’ and is a key objective for PayU across all
the communities we serve globally.
“This deal is an example of how our purpose and our business
objectives work together, accelerating growth and increasing access to
financial services.”
M N Srinivasu, Co-founder of BillDesk, said: “BillDesk has
been a pioneer in driving digital payments in India for well over a decade. This
investment by Prosus validates the significant opportunity in India for digital
payments that is being propelled by innovation and the progressive regulatory
framework put into place by the Reserve Bank of India, India’s central bank.
“BillDesk has always been committed to making payments
faster, easier and more secure. We are excited about what the two great teams
at BillDesk and PayU can deliver together as a driving force within the
evolving digital payments landscape in India.”
According to the FY21 annual report of the Reserve Bank of
India (RBI), the number of transactions for digital retail payments has grown
by more than 80% from 24 billion in 2018-19 to 44 billion to 2020-21.
Over the next three years, RBI expects more than 200 million
new users to adopt digital payments with the average annual transactions per
capita rising tenfold from 22 to 220.
PayU India and BillDesk run complementary businesses within
India’s digital payment industry. Together, the two expect to create a
financial ecosystem handling four billion transactions annually - four times
PayU’s current level in India.