Mobile wallet company Mobikwik has sold 10.83% stake for Rs 225 crores (approximately $35.34 million at current rates) to Bajaj Finance. In a BSE filing, Bajaj Finance said it has entered into a subscription agreement with One MobiKwik Systems.

Mobikwik has been funded by South Africa’s payments major Net1.

The non-banking financial company has entered into a subscription agreement with One MobiKwik Systems. The company that owns MobiKwik, under which it will acquire 10 equity shares and 2.71 lakh compulsory convertible preference shares (CCPS), Bajaj Finance said in an exchange filing.

Announcing the association, Bipin Preet Singh, CEO, Mobikwik stated “Our partnership with BFL will enable us to realise our vision of performing all the functions of bank yet retain our core competency of being India’s leading e-wallet and we strongly believe that this combined value proposition will attract millions of new customers to choose wallet led mobile banking transactions. In short, Mobikwik transforms itself as a new-age bank where our digital transactions will lead to lowering of lending rates and increased supply of money in the Indian economy.”

The company said the conclusion of the transaction is subject to fulfillment of certain conditions in due course. The company has also entered into a shareholders’ agreement which would become effective on the conclusion of the above investment transaction, the filing further noted.

Post conversion of CCPS, Bajaj Finance would hold approximately 10.83% of the equity in MobiKwik on a fully diluted basis, approximately valuing it over Rs 2,000 Crore. However, MobiKwik did not comment till the official statement is released.

Earlier this year, MobiKwik had said it is looking at raising funding for its expansion plans as it looked to compete with larger rival Paytm that is backed by deep- pocketed investors like Alibaba and SoftBank.

Mobikwik has so far raised over USD 85 million in funding from investors like South Africa’s Net1, Sequoia Capital, American Express, Tree Line Asia and Cisco Investments.

Bajaj Finance to buy 11% stake in South African Funded Payment Platform Mobikwik