Indian digital payments and financial services firm Paytm has revealed it will seek regulatory approval for a new general insurance licence
The announcement comes after its deal to acquire general insurance company Raheja QBE did not materialise.
“Our associate company, Paytm lnsuretech Private Limited, had entered into a share purchase agreement to acquire 100% of Raheja QBE General Insurance Company Limited. As the share sale and purchase transaction has not been consummated within the time period envisaged by the parties under the said agreement, the agreement has automatically terminated,” the firm said in a regulatory filing.
The deal valued at around INR5.6bn ($73m) was signed in July 2020.
Through Raheja QBE’s acquisition, Paytm had planned to launch its insurance operations this year.
“Paytm remains bullish on its roadmap for general insurance, and we intend to seek requisite approvals for a new general insurance license, wherein we hold a 74% majority shareholding upfront,” it added.
Currently, the payments major has an insurance distribution licence via Paytm Life Insurance and Paytm General Insurance.
Paytm Insuretech aims to tap Paytm’s customer and merchant base to capitalise on the growth opportunities offered by the Indian market.
In October 2021, Swiss Re agreed to invest $127m in Paytm Insuretech for a 23% stake in the insurer but it is not immediately clear what will happen to the reinsurer’s investment.