(Bloomberg) — Vietnam’s M_Service JSC, which operates Warburg Pincus LLC-backed fintech app MoMo, crossed $2 billion in valuation after raising about $200 million from investors led by Mizuho Bank.
Ward Ferry Management and existing shareholders Goodwater Capital LLC and Kora Management also joined the Series E funding, MoMo said in a statement. The latest funding gives the company a valuation of more than $2 billion, Nguyen Manh Tuong, co-founder of the Ho Chi Minh City-based startup, said in an interview.
The company in January raised more than $100 million, people familiar with the matter said. MoMo has no plans for an initial public offering in the next several years and instead will focus on strengthening its market position and products, Tuong said.
The company plans to use the new funding to support rural expansion, starting with a bill payment service, according to Tuong, who is executive vice chairman and co-chief executive officer. MoMo will also use the funds to accelerate investments in technology, support digital transformations in small and medium enterprises and for mergers and acquisitions.
“The biggest challenge is still trust. Going to the more rural areas, we still need to invest our time and money in educating the users,” Tuong said.
MoMo began in 2010 as a SIM-card application that allowed people to transfer money and buy mobile top-up and game scratch cards. In 2014, it started a smartphone e-wallet that has expanded into a super app with an array of services, including processing insurance payments, donations and providing an investment marketplace.
MoMo’s revenue almost doubled this year despite dramatic drops in movie ticket and travel services sales amid tough anti-coronavirus lockdowns in the country, Tuong said. Registered users grew to 31 million from 23 million last year as consumers and merchants moved to digital platforms during the pandemic.
Vietnam, forecast to have 53 million online consumers by year’s end, has the second-highest growth rate in digital consumers in Southeast Asia, just after Indonesia, according to an August report by Facebook Inc. and Bain & Co. The National Party Congress, which meets every five years, targets the digital economy to comprise 30% of GDP by 2030. Officials want 80% of the population to have online payment accounts by 2025, according to the government’s website.
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