Walmart-Backed PhonePe Likely To Enter Consumer Lending Space By Jan

PhonePe, a prominent digital payments unicorn, is set to expand its services by venturing into consumer lending on its platform, a move anticipated to launch by January next year.

PhonePe, supported by retail giant Walmart, is on the verge of stepping into the consumer lending domain, intending initially to function as a distributor for personal loans. This strategic shift is approaching its final stages, with PhonePe integrating with five lenders, spanning both traditional banks and non-banking finance companies, as reported.

PhonePe Expansion Plans:

Over the upcoming six to seven months, PhonePe plans to introduce an array of consumer credit products. The company has been bolstering its underwriting capabilities to evaluate customer alignment with lenders' criteria. However, the rollout of these offerings to consumers will unfold gradually, sources suggest.

Immediate Focus and Future Outlook:

While exploring the potential for a credit line offering in the near future, PhonePe presently views this aspect as a non-immediate priority. The company's current focus remains on leveraging its user base for monetization and maximizing its extensive distribution capabilities. Its aspirations in the credit sphere mirror the success achieved in distributing insurance products encompassing life, health, motor, and car insurance.

Previous Ventures and Diversification:

PhonePe has solidified its position as a distribution platform for various insurance products, a realm where it collaborates with partners such as Acko. Additionally, the platform facilitates users to make monthly subscription payments through the Unified Payments Interface (UPI).

Diversifying Product Offerings

The platform has been actively diversifying its product offerings through a series of new launches. It also launched the Indus Appstore Developer Platform for Android app developers to take on giants Apple and Google. The mobile app marketplace, Indus Appstore, allows developers to upload apps using its self-serve developer platform.

PhonePe's Revenue Growth

PhonePe recorded a revenue of INR 2,914 Cr in the financial year ended March 31, 2023, an increase of almost 77% from INR 1,646 Cr in FY22. The startup, in a statement, attributed the increase in revenue to growth in money transfers, mobile recharges and bill payments.

Market Expansion and Financial Progress:

Earlier this year, PhonePe made strides in the merchant lending space, launching a marketplace for banks and NBFCs to extend credit to its substantial merchant base of 35 Mn. The platform has diversified its product portfolio through multiple launches, including the Indus Appstore Developer Platform for Android app developers.

PhonePe Financial Performance:

In the fiscal year ended March 31, 2023, PhonePe witnessed a substantial revenue surge, reaching INR 2,914 Cr, marking a 77% increase from the previous fiscal year's INR 1,646 Cr. The surge in revenue is attributed to notable growth in money transfers, mobile recharges, and bill payments, according to the startup's statement.