Dutch Prosus buys Indian online payments giant BillDesk for $4.7bn

INTERNATIONAL DESK: Dutch technology company Prosus has struck a deal to buy leading Indian payment gateway BillDesk for $4.7 billion, expanding the presence of its payments business PayU in the thriving local fintech space.

In the deal announced on Tuesday, Prosus will buy all of BillDesk which had been backed by marquee investors including Temasek Holdings, Visa, General Atlantic, Clearstone Venture, and TA Associates. Prosus will combine BillDesk with PayU.

The new entity would have a total payment value of $147 billion, the companies said in a joint statement, adding that with the acquisition, PayU will handle 4 billion transactions each year, four times its current level.

“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 $6 billion in Indian tech to date, and this deal will see that increase to more than $10 billion,” said Prosus Group CEO Bob van Dijk.

“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,” he said.

PayU focuses on 20 high-growth markets and operates across three distinct businesses — payments for domestic and cross border transactions, credit solutions for consumers and small businesses, and strategic investments in innovative fintech companies. The company’s total payments value increased 51% year-on-year to $55 billion in India, Europe, Middle East, Africa and Latin America in the financial year ended March 2021.

Founded in 2000 by three former Arthur Andersen executives, Ajay Kaushal, M N Srinivasu and Karthik Ganapathy, BillDesk is a leading digital payments provider. Some media reports suggest that BillDesk handles 50%-60% billing transactions in India. The acquisition of the company, is the latest in PayU’s stable that already includes CitrusPay, Paysense and Wibmo.

“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,” said Srinivasu.

According to the Reserve Bank of India, the number of transactions for digital retail payments has grown by over 80% to 44 billion in the financial year ended in March from 24 billion rupees two years ago. The 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, in the next three years. (NIKKEI Asia)