Digital payments and financial services firm Paytm on Wednesday said Switzerland-based reinsurance major Swiss Re will buy a 23 per cent stake in Paytm Insuretech for about Rs 920 crore.
Swiss Re will invest ₹397.3 crore (roughly $52.9 million) upfront in Paytm Insuretech Private Limited (PIT) and the remaining in tranches, subject to fulfilment of certain milestones.
Swiss Re is investing alongside Paytm’s Vijay Shekhar Sharma, who is also expected to make an investment in the entity. The investment is subject to regulatory approvals.
Gross written premium for non-life insurance is expected to increase from $27 billion as of FY21 to $50-60 billion FY26, according to RedSeer data.
India’s insurance market offers a significant opportunity due to the market’s protection gap and under-penetration compared to the global average.
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The development follows the acquisition of Raheja QBE by Paytm Insuretech. “We are excited to partner with Swiss Re for our insurance foray as a key strategic investor. It is an important milestone in our financial services journey of taking general insurance products to the masses,” said Paytm chairman, MD, and CEO Vijay Shekhar Sharma.
In July 2020, Paytm, along with Sharma, announced it was acquiring Raheja QBE, a Mumbai-based general insurance company, from QBE Australia and its 51% domestic partner Prism Johnson of the S Raheja Group for Rs 568 crore.
The company is still awaiting regulatory approval for the deal. At the time of the announcement, the acquisition was routed through QorQl Pvt Ltd (later renamed Paytm Insuretech), where Sharma holds a 51% stake, with One97 Communications owning the rest. Sharma owns close to 15% in One97 Communications and is also its managing director and chief executive.
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