Indian financial startup Paytm has secured a funding of $1 billion in the latest funding, as reported. Paytm was valued $15 billion in 2019, and over 400 million people in India use its services. The company raised $1.4 billion from SoftBank in 2017. Till day, Paytm has raised more than $3.3 billion.

The latest financing round was led by U.S. asset manager T Rowe Price. Investors from previous rounds like Ant Financials and SoftBank are the top contributor this time as well, with an amount of $400 million and $200 million respectively. Paytm was valued at $16 billion by Discovery Capital, which participated in this round as well.

Today, we open next chapter in Paytm’s journey of India’s financial inclusion. We commit to invest additional ₹10,000 crore to serve financially unserved / underserved.

Thank you for your guidance and support.

Dedicating it with my school time favorite Jai Shankar Prasad poem: — Vijay Shekhar (@vijayshekhar) November 25, 2019

The company plans to expand its presence among small and medium-sized businesses with the new money, according to Vijay Shekhar Sharma. The company wants to develop its services in other sectors like insurance and loans.

Chinese interest is rising in fintech

China-based Ant Financials is not the only Chinese company investing in financial companies. Another startup OPay (Opera Pay) based in Nigeria, dubbed as leading fintech startup in the region, received funding of $120 million by Chinese investors. The message is clear that China has confidence which it has gained in the form of their native ventures like AliPay and WeChat Pay. And they are going to be the key players in the next wave of fintech startups in developing countries.

About Paytm

Paytm is based in Noida, near the capital city of New Delhi. It is known as a one-stop-shop of all financial solutions in India. Over 8 million merchants across India use this QR code to accept payments directly into their bank account. It is the first choice of sending money to a friend or booking railway tickets. These financial tasks are otherwise a nightmare in India.

Today it is the first choice of many to skip long queues to pay utility bills, mobile prepaid/postpaid recharge, or even recharge the tv cable service DTH.

READ: Indian Startups have raised $11.3B this year; a record

Founded in 2010, it was only in 2012 that India’s Central Bank approved the mobile wallet feature of Paytm, that now is the backbone of its fintech services.

Challenges for Paytm

The company today faces a tough challenge from PhonePe, which has over 100 million users and Google Pay, which launched the ‘Tez’ app in India two years ago and has signed up more than 25 million users. Today Google Pay is used by 67 million monthly users and it hit the $81 billion transactions mark this March.

The company needed investment to face the challenges of new rivals. In 2019, the company reported a loss of about $550 million or 3,960 crore Indian rupees, way more than a loss of $210 million or 1,490 crore Indian rupees for the same period in the previous year. It was during the time that Berkshire Hathway invested $300 million in Paytm.

Paytm is in the future expected to face new competition from WhatsApp. WhatsApp has a strong user base and one of the popular apps in India. According to Abhijit Bose, head of India, it is going to launch payment services by the end of this year for all of its users.

The company aims to go public post-2021.

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