E-Paper
With MediaTek’s $60m funding, Paytm may be bundled with phones
Taiwanese chipset maker MediaTek is making its maiden investment of $60 million (₹403 crore) in Indian mobile payment company Paytm, which is in the process of raising $300 million (just over ₹2,010) at a valuation of $5 billion.
Taiwanese chipset maker MediaTek is making its maiden investment of $60 million (₹403 crore) in Indian mobile payment company Paytm, which is in the process of raising $300 million (just over ₹2,010) at a valuation of $5 billion.
Paytm’s app will come bundled with new handsets powered by MediaTek chips. “The MediaTek relationship will give Paytm a strong hardware partner, which none of the other payment companies have,” a source aware of the development said.
“This will allow Paytm to pass on the customer acquisition cost to the consumer in form of offers or discounts,” said Sanchit Vir Gogia, CEO and chief analyst at Greyhound Research.
The alliance gives Paytm direct access to a whole host of smartphones from Sony and HTC. It also has a long relationship with Amazon, as it Kindle tablets are powered by MediaTek ships. In 2015, MediaTek’s chips were installed in 35% of the mobiles sold in India.
MediaTek was not available for comments, but a source said that the investment is a strategic one. The source further elaborated that Paytm will invest the money in payments banks, digital services and mobile wallet business.
In March 2015, MediaTek had said that it will put $300 million – taken from its own balance sheet – in companies dealing in semiconductor-systems and devices, internet infrastructure, services and internet of things to have a strong presence in the future of technology.
Reports said that it is bringing a host of 4G handsets to the country. With the entry of Reliance Jio, 4G internet services are expected to take-off in the country. Paytm already has a strong software partner with its relationships with Ant Financial and Alibaba.
