BackPaytm may spin off marketplace business
News comes at a time when Chinese e-commerce giant Alibaba, an investor in Paytm, is set to launch its operations in the country this year
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New Delhi: Paytm, run by One97 Communications Ltd, is expected to spin off its marketplace business into a separate mobile app within the next three months, said founder Vijay Shekhar Sharma.
The firm is yet to select a name for the new entity.
The news comes at a time when Paytm’s investor Alibaba is set to launch its operations in the country this year and is scouting for partnerships.
Paytm recently created an online mall format for its commerce platform, where different brands and sellers can create their pages. Paytm seems to have taken a leaf from Alibaba’s Tmall in China.
“Marketplace is a critical component of our business. We have grown significantly to create an independent firm," said Sharma without commenting on a possible tie-up with Alibaba.
Mint reported in August that Paytm was considering spinning off its e-commerce and payments business.
Paytm’s e-commerce marketplace currently gets close to two million orders a month and is expected to grow to about five million orders a month by March 2017.
Paytm, which currently claims to do a GMV (gross merchandise value or in this case, value of total transactions) of ₹ 20,000 crore, gets 40% of the GMV from the marketplace.
The Paytm marketplace currently has about 125,000 merchants, and the company expects it to double by fiscal 2017.
While Paytm’s core business is mobile payments and mobile recharges, it has aggressively built its e-commerce marketplace over the past 18 months, selling apparel, footwear, smartphones, laptops and other products.
In September, Paytm received undisclosed funding from China’s e-commerce giant Alibaba.
Mint reported in September, Ant Financial and Alibaba together committed to put less than $1 billion in Paytm. This amount includes the $575 million, which was committed to Paytm in February 2015.
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