SoftBank-backed PayPay valued at $12.7 billion in Nasdaq debut as shares jump

By Arasu Kannagi Basil, Utkarsh Shetti and Echo Wang

March 12 (Reuters) - PayPay's PAYP.O shares opened roughly 19% above their offer price in a widely anticipated Nasdaq debut on Thursday, valuing the Japanese payments app at $12.7 billion and giving a much-needed boost to the new listings market.

The SoftBank-backed company's stock opened at $19, compared with the $16 offer price. PayPay and an investment fund controlled by the SoftBank Group 9984.T sold about 55 million American Depositary Shares below the marketed range of $17 to $20 to raise roughly $880 million.

PayPay pushed ahead with the offering despite the conflict in the Middle East roiling global markets and weighing on risk sentiment.

The U.S. IPO market has also struggled to find its footing over the past month, with sharp market swings nudging some companies to delay their listing plans.

"Given the backdrop, it's a positive for the IPO market that PayPay is trading well so far. I think it speaks to the strength of the company, which has strong market share in Japanese payments," said Nicholas Einhorn, vice president, research at Renaissance Capital, a provider of IPO-focused research and ETFs.

"This is the kind of company investors tend to like."

The IPO was initially expected in December, but the historic U.S. government shutdown last fall delayed the regulatory review.

"With new listings being priced lower to offer after-market appeal, it increasingly looks we are in an IPO 'buyers' market' where companies aim for stable debuts and a positive launch story," said IPOX Research Associate Lukas Muehlbauer.

"While initial low pricing can mean the company leaves money on the table, it can help create positive aftermarket momentum."

PayPay marks the first U.S. listing of a SoftBank majority ​investment since the blockbuster 2023 IPO of chip designer Arm ARM.O.

The listing comes as SoftBank steps up its push into artificial intelligence, including its "all-in" bet on OpenAI.

DOMESTIC STRENGTH

Jointly formed by SoftBank and Yahoo Japan in 2018, PayPay entered the market by waiving transaction fees for small and medium-sized merchants for up to three years to spur adoption.

"Payments is the foundation of our business, and we're going to transform into a financial services platform post IPO," PayPay CEO Ichiro Nakayama told Reuters in an interview at the Nasdaq.

The Tokyo-based company has played a vital role in encouraging Japanese consumers to move away from cash by offering rebates on its payments app.

Within years of its launch, PayPay achieved $100 billion in gross merchandise volume and has become one of the most widely used digital wallets in Japan. It had roughly 72 million registered users at the end of 2025.

"The appeal of the company is that it's one of the few fintech IPOs that have already won its domestic market... The domestic strength gives the company some insulation from the geopolitical, tariff and AI-related concerns weighing on many other technology names," Muehlbauer said.

Japan still remains a global laggard in payments technology, leaving ample runway for growth as digital adoption accelerates.

Initially focused on cashless payments, PayPay has since expanded into credit, banking, securities and insurance to become an all-in-one digital finance platform.

Last month, PayPay announced a partnership with card giant Visa V.N as it looks to expand into the U.S.