Facebook has invested an amount of $5.7 billion in Reliance Jio by buying 9.99% stakes in the firm. The investment has provided Facebook a stronghold in the fast-paced and ever-growing market of Jio in India. The pre-money value of the deal stands at $65.95 billion.
As per the stats, this is the largest FDI in the technological sector in India and the largest investment from a technology company in a minority stake in the world. The investment is also going to help Reliance Industries Limited (RIL) in clearing out the previous debts on the company.
One of the possible benefits of this deal could be the integration of Facebook’s WhatsApp instant messenger service (and WhatsApp Pay) with JioMart, an e-commerce business from Reliance industries.
According to David Fischer, Chief Revenue Officer at Facebook, and Ajit Mohan, VP and Managing Director of Facebook India, “We can enable people to connect with businesses, shop and ultimately purchase products in a seamless mobile experience.”
Facebook CEO On Partnership With Jio
Facebook CEO Mark Zuckerberg said that the company is collaborating with Reliance Jio and both the companies will work together on some big projects to create a lot of opportunities for people all over India.
He said that India has entered the era of digital transformation and firms like Jio have played a major role in connecting people and small businesses by providing internet facilities at comparatively cheaper rates than other companies.
He concluded his post by saying that India has more than 60 million small businesses. Due to the lockdown, most of them need digital tools to communicate with the customers. Jio and Facebook have partnered to provide them with all the essential tools to grow and create new opportunities.
Jio CEO’s Response
Mukesh Ambani, Reliance Jio CEO, said that he is excited to welcome Facebook Inc as their official partner. He mentioned that the partnership will boost the digital transformation of India and will open up new employment opportunities.
The deal came in action after the Indian government showed a green flag to WhatsApp’s digital payment service. We will soon see WhatsApp’s payment service competing with Paytm and Google Pay.
WhatsApp has a user base of 400 million in India which is almost 80% of smartphone users in the country. It will be interesting to see how WhatsApp’s digital payment service will snatch users from Google Pay and Paytm.