**IPO-bound PhonePe Doubles Revenue from Its Subsidiaries**
*By Akash Pandey | Oct 06, 2025, 11:10 AM*
Leading fintech company PhonePe has reported a significant surge in revenue from its subsidiaries, marking a notable shift in its business performance ahead of its upcoming IPO. In the fiscal year 2025 (FY25), PhonePe’s insurance, stock broking, and lending verticals collectively contributed ₹615 crore to the company’s overall revenue. This represents a substantial increase compared to the previous fiscal year, where these segments made up around 4% of total income. Now, they account for nearly 9% of PhonePe’s overall earnings, according to filings with the Ministry of Corporate Affairs.
**Dominance in UPI Payments Business**
Despite expanding into diverse financial services, PhonePe continues to dominate India’s UPI payments landscape, holding a 45% market share, well ahead of competitors like Google Pay and Paytm. The company’s primary payment revenue stems from merchant services including SmartSpeakers, point-of-sale device subscriptions, transaction-based incentives, and commissions.
This strong foothold in the payments ecosystem has enabled PhonePe to build a vast user base, which it leverages to cross-sell financial products such as mutual funds, insurance policies, and credit lines.
**Financial Challenges Amid Revenue Growth**
While revenue contributions from subsidiaries have increased significantly, profitability remains a challenge. The lending vertical experienced nearly a six-fold revenue jump—from ₹66 crore in FY24 to ₹378 crore in FY25—but losses slightly widened from ₹128 crore to ₹162 crore.
Similarly, the insurance arm reported higher revenue of ₹180 crore, up from ₹108 crore last year. However, losses narrowed to ₹204 crore from ₹247 crore, showing some improvement.
**Stock Broking and Other Verticals**
PhonePe’s stock broking business, operating under the Share Market brand, saw revenue grow from ₹27 crore to ₹48 crore in FY25. Despite this, losses deepened to ₹312 crore from ₹184 crore. The hyperlocal commerce app Pincode reported revenue tripling to ₹10 crore but also saw losses rise sharply to ₹283 crore.
The Indus App Store India recorded no revenue in both years, with losses increasing from ₹123 crore to ₹158 crore.
**Growth Strategy and Market Deployment**
PhonePe has deployed approximately 10 million merchant devices across India, reinforcing its presence in the payments ecosystem. According to co-founder and CEO Sameer Nigam, each subsidiary has its own gestation period, requiring significant investment in branding, marketing, and cashbacks during the early stages of growth.
He noted that the merchant business and payment gateway services are already generating profitability. Some verticals within the payments subsidiary also report higher margins compared to revenue generated purely from payment processing or transaction charges.
**Industry Trend: Diversification in India’s Fintech Sector**
PhonePe’s diversification into lending, insurance, and wealth management reflects a broader trend among Indian fintech companies. Major players such as Paytm, CRED, BharatPe, and Razorpay are expanding beyond traditional payments to develop sustainable revenue streams.
This strategic shift arises from the understanding that UPI transactions, while voluminous, generate little to no direct revenue, making diversification essential for long-term growth.
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PhonePe’s rising revenue from subsidiaries, combined with its dominant position in UPI payments and strategic diversification, positions it strongly in India’s evolving fintech landscape as it prepares for its IPO.
https://www.newsbytesapp.com/news/business/phonepe-s-subsidiary-revenue-jumps-to-615cr-9-of-total-earnings/story
