Payments and financial services unicorn PhonePe is in talks for a new funding round led by General Atlantic at a valuation of more than $12 billion that would make the Walmart-backed startup India’s most valuable financial institution, people familiar with the matter said.

“General Atlantic is likely to lead the round with an investment of $4.5 to $500 million,” said one of the people cited above.

Another person said this was not a pre-IPO round as the company’s public listing plans are at least 2-3 years away. PhonePe will use the funds raised to double down on its ambition to become a financial services super-app — offering everything from payments to insurance to investing to commerce.

If this round goes through, PhonePe will become a decacorn or startup valued at more than $10 billion, joining the likes of Flipkart, Paytm (which went public last year), Byju’s and Swiggy, which Walmart acquired. PhonePe will also be valued more than digital payments and neo-banking unicorn Razorpay, valued at around $7.5 billion.

It will also be a rare example of a startup raising money late in the winter, with investors signing small checks as they become cautious in a deteriorating macro environment. When PhonePe was spun off into a separate entity by Flipkart, it was valued at $5.5 billion. At that time, Flipkart had invested $ 700 million.

PhonePe’s fundraising talks come at a time when the valuation of its closest rival, Paytm, has fallen more than 60% since last November, and public shareholders have questioned the company’s ability to achieve company-level profitability. As of October 20, Paytm’s total market capitalisation was just under $5 billion.

However, Paytm’s revenue is much higher than PhonePe’s. Paytm’s revenue stood at Rs 3,892.4 crore as of FY22, while PhonePe’s was at Rs 1,646 crore.

While PhonePe reported a loss of Rs 671 crore (excluding ESOP costs) in FY22, its net loss for the year is expected to be much higher than in FY21, with a net loss (including ESOP costs) of Rs 1,728 crore excluding Rs 789 crore Meanwhile, Paytm reported a net loss of Rs 2,325 crore in FY22, widening from Rs 1,560 crore in FY21.

The discussion of the new funding round coincides with PhonePe’s plans to move its registered entity from Singapore to India ahead of its Singapore IPO. But one person said the move to India was also since many of PhonePe’s operations are under the purview of local regulators.

In an interview with CNN News18’s Bits to Billions in June, PhonePe co-founder and CEO Sameer Nigam revealed that the company was moving its registered entity from Singapore to India. He said the board had signed off on the plan, and it was only a matter of time before the process was completed.

With the Reserve Bank of India’s (RBI) influence in the industry waning across the board, the country’s fintech companies are also facing particular challenges regarding funding scrutiny.

In addition, valuations of global financial services and technology companies have fallen sharply this year as macroeconomic uncertainty has led to a broader correction in global financial markets. Earlier this month, Prosus-owned PayU pulled out of a $4.7 billion BillDesk deal, one of the biggest indicators of pressure on fintech valuations in the country.

PhonePe was founded in 2015 by former Flipkart executives Sameer Nigam, Rahul Chari and Burzin engineer PhonePe. With over 400 million registered users, the fintech company is a leader in Unified Payments Interface (UPI) transactions. The company has a market share of 47% in monthly UPI trading volume.

The company expanded into financial services in 2017, allowing customers to buy gold, insurance and mutual funds on its platform and pay bills and utilities. The company will compete with Paytm, Pine Labs, and Razorpay as it likely looks at providing payment gateways for large offline players and small and medium-sized businesses. In the past year, PhonePe has acquired GigIndia, WealthDeand sk, and OpenQ and completed its long-term acquisition of IndusOS.