Paytm has announced a Joint Venture (JV) general insurance company named as Paytm General Insurance Ltd (PGIL). Paytm has announced plans to infuse Rs 950 crore in PGIL in tranches, over a period of 10 years and to hold an upfront equity stake of 74% in JV. Following the investment, Paytm General Insurance will become a subsidiary of Paytm.
Incorporated in 2018, PGIL plans to register for and undertake general insurance business defined under Section 2(6B) of the Insurance Act, 1938 (“Insurance Act”). Notably, PGIL is yet to commence its general insurance business which is currently subject to receipt of the certificate of registration from IRDAI.
At present, One 97 holds a 49% stake in PGIL, while the remaining 51% is held by VSS Holdings Private Limited (“VHPL”), a company owned and controlled by Vijay Shekhar Sharma. Post the completion of the transaction, PGIL will become a wholly-owned subsidiary of Paytm where the latter will hold about 74% shareholding, and the remaining 26% stake will be held by VHPL.