Flipkart-owned e-commerce payment system and digital wallet company, PhonePe, is in discussions with marquee investors for fundraising of approximately $1 billion, according to a report by The Economic Times.

DST Global, Ribbit Capital, Falcon Edge, Green Oaks and China's Hillhouse Capital are some of the investors that have held talks with PhonePe, the report said.

DST Global, which had invested in Flipkart in 2014, is likely to make an investment in PhonePe, the report said.

The payments platform was recently hived off from Flipkart as an independent entity, permitting a separate valuation to seek fundraising.

Moneycontrol could not independently verify the report.

A PhonePe spokesperson declined to comment when approached by The Economic Times.

"The final capital being raised would depend on the valuation, but they (PhonePe) are looking to dilute about 10 per cent in this fund-raise," a source told the paper.

The company is eyeing a valuation of $8-12 billion, and is not open to a valuation of under $8 billion, the report said.

Strategic investors who already support Flipkart are likely to back PhonePe, sources told the paper.

Tiger Global and Tencent, who have previously invested in Flipkart, are involved in the negotiations regarding PhonePe’s fundraising.

On July 30, PhonePe received Rs 698 crore from Flipkart. The payments digital platform also received $700 crore from its parent company in March 2019.

PhonePe clocked 335 million transactions in July at a total payment volume run-rate of over $90 billion.