SoftBank's payment app operator PayPay (PAYP.US) is applying for a US IPO or to raise over $2 billion.

SoftBank's Japanese payment app operator PayPay, after experiencing delays in its regulatory review caused by the US government shutdown, is now pushing forward with its highly anticipated IPO plans. PayPay publicly submitted its initial public offering (IPO) application on Thursday. It is reported that the company's IPO could raise over $2 billion, with investors expecting PayPay's valuation to exceed 3 trillion yen. The company plans to list on the Nasdaq with the stock code "PAYP". PayPay originally planned to go public in December last year, but the longest government shutdown in US history delayed the regulatory approval process, leading the company to postpone its scheduled listing. PayPay's listing will be the first SoftBank majority-owned investment project to be listed in the US since the highly anticipated IPO of UK chip design company Arm Holdings (ARM.US) in 2023. Currently, SoftBank is raising funds through asset monetization for its expanding artificial intelligence initiatives. Data shows that in the nine months ending on December 31, PayPay achieved a profit of 103.3 billion yen (about $675 million) and revenue of 278.5 billion yen, compared to a profit of 29 billion yen and revenue of 220.4 billion yen in the same period last year. Matt Kennedy, Senior Strategist at Renaissance Capital focusing on IPO research and ETFs, stated, "These numbers are very impressive. When we talk about premium-valued companies, PayPay undoubtedly meets the standards. Only a handful of companies have such profitability performance." He added, "The current US IPO market needs a success story, and the strong debut of a large company like this will boost confidence, even though it is a relatively unique Japanese fintech story." Established in 2018 by SoftBank and Yahoo Japan, PayPay has played a significant role in driving Japan's digital transformation. The company offers cashback through its mobile app, encouraging consumers to reduce cash usage. In just over seven years since its establishment, PayPay has rapidly expanded to become one of the most widely used payment platforms in Japan, with approximately 72 million registered users as of December 31. Japan was once known for its "cash is king" mindset, but in recent years, the proportion of cashless payments has increased significantly. However, compared to other countries worldwide, Japan still lags behind in payment technology, leaving room for further growth. Matt Kennedy said, "The Nikkei 225 index is at historical highs, and investors are clearly enthusiastic about Japanese stocks. I expect this to be the largest IPO of a Japanese company in the US." Analysts believe that due to PayPay's strong presence in the Japanese market and the accelerated transformation towards cashless payments in the country, its valuation may enjoy a premium compared to fintech peers listed in the US. Additionally, although PayPay initially focused on cashless payments, it has now expanded into areas such as credit, banking, securities, and insurance.