Has PayU India’s Loss Widened in FY25 Amidst Intensifying Competition?
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Synopsis
PayU India, the fintech arm of Prosus, reported a widening loss of $44 million in FY25, despite notable revenue growth. This article dives into the financial challenges faced by PayU amidst rising competition in the digital payments landscape. Discover how strategic acquisitions and improved engagement are shaping its future.
Key Takeaways
- PayU India's aEBIT loss increased to $44 million.
- Overall revenue growth was 21.41% YoY, reaching $669 million.
- The credit business revenue surged by 59.81% to $171 million.
- PayU tightened underwriting standards to manage credit risk.
- Acquired 70% of Mindgate Solutions for $68 million.
New Delhi, June 24 (NationPress) PayU India, the financial technology division of Dutch investor Prosus, revealed on Tuesday that its actual consolidated earnings before taxes (aEBIT) loss surged to $44 million in FY25, up from $32 million in FY24.
The credit division also faced increased losses, with aEBIT loss rising from $20 million in FY24 to $32 million in FY25, as per Prosus’ latest annual report.
This escalation in losses occurred despite robust revenue growth in both the payments and credit sectors.
The company’s overall revenue increased by 21.41 percent year-on-year (YoY), climbing from $551 million in FY24 to $669 million in FY25.
PayU’s primary payments division contributed $498 million to this total, marking a 12.16 percent rise from $444 million the previous fiscal year.
This growth was bolstered by enhanced engagement with existing merchants and an uptick in demand for value-added services, although fierce competition within India’s rapidly expanding UPI ecosystem continues to impact margins.
In spite of these hurdles, PayU’s payments sector showed signs of recovery, achieving breakeven in the latter half of the year.
Its aEBIT margin improved from -8 percent in FY24 to -2 percent in FY25, according to the company’s latest annual report.
The credit segment, managed under PayU Finance, experienced significant growth, with revenue soaring 59.81 percent to $171 million, up from $107 million a year prior.
The unit disbursed $1.1 billion in loans throughout the year, with 23 percent allocated to small- and medium-sized businesses.
However, this growth incurred a cost, as the credit loss ratio escalated to 5.8 percent in the second half, leading to a (-19 percent) aEBIT margin for the segment.
In reaction, the company has tightened its underwriting standards to mitigate risk. "We’ve implemented decisive measures to enhance our risk practices, and the progress in recent loan cohorts shows initial traction," the company stated.
To strengthen its position in India’s digital payments landscape, PayU has acquired a 70 percent stake in Mindgate Solutions for $68 million.
Mindgate is a real-time payments technology firm, and this acquisition is anticipated to bolster PayU’s UPI capabilities and operational efficiency.
Point of View
It's crucial to understand the implications of PayU India's financial results. The widening loss signifies the intense competition within the fintech sector. While the company shows revenue growth, its ability to adapt to market challenges will determine its future success. NationPress remains committed to delivering insights on such critical economic narratives.
NationPress
24/06/2025
Frequently Asked Questions
What was PayU India's aEBIT loss in FY25?
PayU India's actual consolidated earnings before taxes (aEBIT) loss rose to $44 million in FY25.
How much revenue did PayU generate in FY25?
PayU's overall revenue increased by 21.41 percent to $669 million in FY25.
What was the growth rate of PayU's credit business?
The credit business saw a revenue increase of 59.81 percent, reaching $171 million in FY25.
What actions is PayU taking in response to rising credit losses?
PayU has tightened its underwriting standards to mitigate risk associated with credit losses.
What acquisition did PayU make to strengthen its position?
PayU acquired a 70 percent stake in Mindgate Solutions for $68 million to enhance its UPI capabilities.
