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Japan is surprise bright spot for India's Paytm
JAPAN is an unlikely bright spot for India's payments poster child.
Facing fierce competition at home, Paytm has raised fresh funds from Ant Financial, SoftBank's Vision Fund and others, at a US$16 billion valuation.
That comes as SoftBank boss Masayoshi Son plans a rejig with Japan's top chat app, Line.
Paytm too could see its fortune transformed in the distant mature market and beyond. Against India, the island nation is a contrast: its population is just one tenth the size and 20 times richer on a per capita basis.
In both countries, though, citizens share a bizarre addiction to transacting in cash and politicians in New Delhi and Tokyo are pushing for them to take up digital alternatives.
Paytm's QR code technology is at the forefront of change across the nations. In India, its app has racked up 350 million users.
And last year, SoftBank entities including Yahoo Japan, now known as Z Holdings, launched a digital wallet service in Japan built on Paytm know-how.
PayPay on Monday disclosed that it has registered 20 million users in just over one year. Generous giveaways and rewards have helped. It is unclear how PayPay's success feeds into the bottom line of the Indian group. But exporting home-grown technology could prove lucrative down the line.
It helps that Mr Son himself has an incentive to allow Paytm to shine. After all, SoftBank first pumped US$1.4 billion into the upstart in 2017 before transferring the stake into the Vision Fund.
Either way, SoftBank is set to end up with indirect interests in both PayPay and a top rival following a complex US$15 billion planned merger between Line and Z Holdings that was unveiled last week.
The companies are tight-lipped on whether they will merge the two payment apps, but an alliance at the top could help the pair bolster market share and growth.
For his part, Paytm's Vijay Shekhar Sharma is confident his group can expand globally, as well as at home, following in the footsteps of other Vision Fund-backed Indian startups like Oyo Hotels.
Any success will be valuable: payments in India is largely built on top of government-backed infrastructure which makes the cost of moving money extraordinarily low.
A tiny slice of smaller, richer, markets could make a big difference. REUTERS