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Oxigen to hive off its wallet and online businesses as Phi Enterprises

Oxigen wallet

Payments company Oxigen Services will be hiving off its online businesses, which includes its digital wallet, into a separate entity known as Phi Enterprises. The development was first reported by Economic Times. Speaking to MediaNama, Oxigen’s deputy managing director Sunil Kulkarni said that the company had planned to de-merge the online business as part of its payments bank licence application.

“The infrastructure and financial services business will remain with Oxigen, and the online business – the mobile application and the website where the payments are done , will be hived off,” Kulkarni said. He also confirmed that the company is also looking to raise Rs 1,300 crore for the new entity. “The online business require considerable dollars for visibility and branding. So Oxigen’s financial services is a profitable entity and you can’t use that to fund the online business, which has its separate investors,” Kulkarni added.

Oxigen’s operations

Oxigen had earlier informed MediaNama that it has 10 million users in its wallet and online business with the average value of transactions per month being around Rs 450 crore. Oxigen’s wallet also has about 1.5 million transactions occurring every month.

On the other hand, Oxigen claimed that its offline retail business has 150 million users and the average value of transactions per month is around Rs 1,000 crore. The number of transactions on its offline network is around 50 million. Oxigen has over 200,000 touch points in addition to its banking correspondents in its offline network.

Developments in digital payments

The digital payments space has been seeing a renewed interest with a number of deals and investements.

– Last week, German payments company Wirecard bought Great Indian  Retail Group‘s for 230 million euros ($254 million) in a cash deal. Wirecard would acquire 100% of the shares from Great Indian Retail Group and financial investors of companies operating payment services in India, Philippines, Indonesia and Malaysia. In addition, Wirecard also bought 60% of the shares in GI Technology (GIT), a subsidiary which has a prepaid payments instrument licence from the Reserve Bank of India.

– In October, Payment gateway Razorpay raised $9 million in a series A round of funding led by Tiger Global and participation from Matrix Partners.

– In the same month, Citrus Payment Solutions raised an undisclosed amount Series C funding  and acqui-hired the payments startup Zwitch for an undisclosed amount. Following the deal, founders Anish Achutan and Mabel Chacko will be joining Citrus Pay along with the core members of Zwitch.

– Multi-bank mobile banking app Chillr also raised $6 million in a Series A round of funding from Sequoia Capital. According to the platform, the funding round is not complete yet, and other investors would be investing in the coming weeks.

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