Digital payments major PhonePe has raised $350 million in funding from global private equity firm General Atlantic at a pre-money valuation of $12 billion, making it the most valuable privately held Indian fintech firm.

According to the company, the investment marks the first tranche of an up to $1 billion fundraise that started this month, with other global and Indian investors also participating in the round.

PhonePe, owned by Walmart, was last valued at $5.5 billion after raising $700 million from the US retail major in December 2020. Its valuation has now surpassed that of digital payments provider Razorpay, which was last valued at $7.5 billion.

General Atlantic has also invested in other Indian startups like Byju’s and Unacademy. While the primary fundraise was estimated to be $1 billion in size, it will include a secondary share sale, taking the total financing to $1.5-2 billion.

In a secondary share sale, existing investors sell their shares to new investors and the money doesn’t go to company coffers.

Existing and new investors, including Chinese tech major Tencent, Qatar Investment Authority, Microsoft and Flipkart’s cofounder Binny Bansal, were also expected to invest in this round, as per reports.

These are investors in Flipkart who were given the option to invest in PhonePe’s new funding round since the payments firm was part of the Flipkart group. Investors like SoftBank, GIC and others are unlikely to participate in the funding and won’t have any stake in its India unit.

Existing and new investors including, Chinese tech major Tencent, Qatar Investment Authority, Microsoft and Flipkart’s cofounder Binny Bansal were also expected to invest as a part of this round.

According to reports, PhonePe was seeing to close a funding round of $1.5-2 billion with both Walmart and General Atlantic expected to pump in capital at a pre-money valuation of $12 billion.