Upasana Taku, co-founder, MobiKwik
Why has net loss widened over the year?
We cannot compare Q1FY26 numbers with those of the previous fiscal’s first quarter because we have been stating that H2FY25 was extremely bad due to sentiment regarding unsecured lending. That automatically means Q1 FY25 was the best quarter, as there were no headwinds on the lending side of the business. I think what investors are more interested in is recovery. To see the recovery, we should compare the business parameters with those of the last quarter. Last quarter, our EBITDA loss was Rs 45 crore, which has reduced to ₹31 crore in Q1. Our QoQ EBITDA rose by roughly ₹14.5 crore. If we demonstrate similar improvement, we should be able to break even in Q3 or Q4. We have seen significant growth in our payments business’s GMV (gross merchandise value), and we have also improved our margins in this segment. We have optimised all our direct costs.
What is driving the rise in operating revenue sequentially?
We have seen disbursals in the financial services segment increase by 30 per cent or more in the last two quarters. This reflects the recovery in the lending segment. The revenue in the financial services segment has increased, and the margin has also improved to 13.3 per cent in Q1FY26 from 4.3 per cent. Again, it is not back to the normal range of 30-40 per cent, but it is moving towards that direction. By Q3, we should start seeing the lending business margin return to its normal range. On the payments side too, last quarter our margin was 23.9 per cent, which we have now grown to 27.9 per cent. We are consistently showing strong growth in our payments business, having grown GMV by 16 per cent quarter-on-quarter and 53 per cent year-on-year.
Do you intend to restart the BNPL business?
It has been completely paused as no lender is interested in doing that business due to regulatory developments. It is not just us; other payment companies are also unable to register any growth in the buy now, pay later business.
Have the new FLDG guidelines had a major impact on business?
It has. Since August-September last year, we have transitioned all our contracts with lenders to a 5 per cent first-loss, default guarantee model. Currently, half of our business is under this contract, and half is under a different earlier contract. We expect things to normalise this year because all our revenue and costs will be booked under the same model. The problem with the current model is that the cost is higher upfront, and the revenue is generated in the back end. That is also the reason for a slightly lower revenue in the financial services business, and after September this year, it will start normalising. Just to clarify, the margins we make are still the same; it is just a temporary accounting change.
There was a slower pace of growth on the merchant acquisition side in the first quarter…
Yes, growth has been weak on this front as this business is heavily linked to feet on street. There were some problems. That aside, Q1 has typically been a slower quarter for us. From Q2 to Q4, we register solid growth in customer acquisition.
What are the newer products in the pipeline?
We continue to be bullish on our pocket UPI product, which allows people to use our app to scan and pay at any QR code, regardless of who has deployed UPI. This product is growing rapidly, in line with our overall UPI growth. We have just launched the Rupay credit card, and it is one of the growth areas for us. Separately, we are trying to ramp up Zakpay, our payment aggregator and payment gateway business. We see huge growth potential there and are trying to beef up that team. There are also numerous AI initiatives aimed at improving customer experience, collections, and AI-assisted coding for engineers.
Published on August 8, 2025
