Last December, it launched a programme where it allotted ESOPs worth INR 1,500 Cr.
PhonePe led the UPI space with 47% of the transactions in October.
Almost 75% of the current workforce is eligible to participate in buyback offer
Flipkart-owned PhonePe has announced a buyback of ESOPs worth INR 135 Cr for all employees under the Employee Stock Option Programme (ESOP).
In a statement, the digital payments major said that the buyback would be carried out in a three-tier model wherein the top leadership can sell up to 10% of their vested stock and all other current employees can sell up to 25%.
The company’s founders, however, will not be participating in the buyback.
In December 2020, PhonePe launched its ESOPs programme where it allotted ESOPs to all its 2,200 employees starting at a minimum of INR 3.5 Lakhs, cumulatively worth INR 1,500 Cr.
Manmeet Sandhu, Head of HR, PhonePe said, “All these employees will complete the one year cliff of their stock vesting next month, so it’s a great time to offer some liquidity to everyone. Almost 75% of our current workforce is eligible to participate in the current buyback offer.”
Several startups are taking the ESOP route to incentivise their employees in a bid to retain and hire top talent.
Earlier this month, CRED, a member-only fintech and ecommerce platform announced that its cumulative Employee Stock Option Programme (ESOP) buyback for the year will be up to INR 100 Cr.
In October, social commerce unicorn Meesho announced a $5.5 Mn employee stock ownership liquidity program for all eligible current and former employees with vested stocks, making this the startup’s second liquidity program this year.
The development comes at a time when PhonePe is making major headway among the digital payment players. According to NPCI data, PhonePe was the most used app in terms of UPI transactions in October, accounting for 47% or 1.93 Bn transactions worth INR 3.65 Lakh Cr. Google Pay came in second with 34% share.
Of late it has also been in the limelight due to controversies and legal issues including its court battle against B2B digital payments platform BharatPe.
On November 12, the Delhi High Court set aside BharatPe’s petition to cancel multiple registrations of PhonePe for the ‘Pe’ suffix. Earlier in October, PhonePe withdrew its injunction plea with the Bombay High Court against BharatPe’s usage of the ‘Pe’ suffix for its newly launched ‘buy now pay later’ offering postpe.
Last month, the Mumbai-based fintech major was also in the news as it started charging customers on mobile recharges as a “small scale experiment”.
The company clarified that it is not a full-fledged roll out of the processing fees on mobile recharges.
Launched in 2015 by Sameer Nigam, Burzin Engineer and Rahul Chari, PhonePe offers a digital payments platform where consumers can send and receive money, recharge mobile, DTH, data cards, pay at stores, make utility payments and more. In 2016, ecommerce major Flipkart acquired the platform.
PhonePe has also been expanding its verticals of business aggressively. In August, the fintech unicorn received its insurance broking license from IRDAI to diversify into direct broking.
In addition, it also received approval from the RBI to function as an account aggregator.
Besides, PhonePe is also set to apply for its mutual fund’s license to play in the stock market.