JOHANNESBURG - Prosus plans to expand its India e-commerce by acquiring a majority stake in digital-credit provider PaySense, which was valued at $185million (R2.66 billion) for the deal.
Prosus’ share price increased 3.32 percent just after midday on Friday to R1129.41 on the JSE, while the share price increased 2.76percent to 71.59 (R1 142.59) in Amsterdam, indicating the transaction was favourably received by investors. The share closed the day at R1126.23.
Naspers-owned Prosus plans to combine PaySense with its existing consumer-lending operation LazyPay, which is a subsidiary of Prosus’ online services provider in India PayU, a statement said on Friday. A further $200m would be invested in the combined entity over two years.
“While in India the share of adults with a bank account has more than doubled since 2011 to above 80 percent, access to credit remains limited for those without the credit histories traditional lenders rely on to make lending decisions. The combination of LazyPay and PaySense, both pioneers in using alternative data to make lending decisions, will create a new digital lending leader that can help more of the new-to-credit Indian population,” Prosus’ directors said.
BCG research showed India’s digital lending market may represent a $1trillion opportunity over five years.