MUMBAI: PhonePe, the Walmart-owned digital payments platform that accounts for nearly half of India’s UPI transaction volumes, has been diversifying its revenue streams to improve profitability and cash generation ahead of its planned public listing.
Of its Rs 7,114.9 crore revenue in FY25, about Rs 6,299.7 crore, roughly 86%, came from core payment services, including merchant payments. The remaining revenue was generated from businesses such as co-lending, insurance distribution and mutual fund services.
The company was planning to launch what could be the largest fintech IPO in India in April, but market uncertainty following the Middle East conflict may affect the timing of the proposed USD 1.5-billion offering. The IPO is expected to be largely an offer for sale by investors including Walmart and Tiger Global, and could value the company at around USD 15 billion.
PhonePe’s revenue rose over 40% year-on-year to Rs 7,114.9 crore in FY25 from Rs 5,064 crore in FY24. Net losses narrowed to Rs 1,727.4 crore even as total expenses stood at Rs 9,394 crore. Employee benefit expenses accounted for Rs 4,096.7 crore during the year, up from Rs 2,914.3 crore in FY23, representing a CAGR of 56.25% between fiscals 2023 and 2025.
In the first half of FY26, the company reported revenue of Rs 4,174.6 crore, compared with Rs 3,918.5 crore in the same period a year earlier. Merchant payments contributed 30.78% of revenue during the period, while co-lending, insurance and mutual fund distribution accounted for 11.55%, down a tad from the full year period of FY25 when it was around 14%.
PhonePe has been steadily expanding non-payment revenue streams in recent years. Revenue from co-lending and insurance distribution grew at a compound annual rate of 345.8%, rising from Rs 28 crore in FY23 to Rs 557.6 crore in FY25, according to its filing with SEBI.
The co-lending business, launched in March 2023, has seen strong traction, with loan disbursals reaching Rs 14,270 crore by September 2025. Since receiving an insurance broking licence in August 2021, the company has sold about 18.49 million policies till September 2025.
Beyond payments and lending, PhonePe has also expanded into stock broking, mutual fund distribution and marketplace services. Revenue from these businesses grew 156.7% to Rs 57.25 crore in FY25 from Rs 22.3 crore in FY24, mainly driven by commissions from asset management companies and stock broking activity.
The contribution of merchant payments to overall revenue has steadily increased from 14.75% in FY23 to 27.99% in FY25 and 30.78% in the six months ending September 2025. Meanwhile, revenue contribution from lending, insurance and mutual fund distribution has been clipping at from 0.96% in fiscal 2023 to 7.84% in fiscal 2025 and 11.55% for the six months ending September 2025.
According to a report by RedSeer, PhonePe’s merchant payment volumes reached Rs 112 trillion in FY25 (around USD 1.3 trillion) and are projected to grow at a compound annual rate of 20–22% through FY30.
The company’s revenue growth has been driven by transaction processing fees paid by merchants and partners, platform fees, consumer transaction charges and subscription fees from offline merchants using payment devices.
These were primarily led by increases in TPV which is in turn led by increase in the number of customers and merchants. Customer TPV on its platforms increased to Rs 132.70 trillion in FY25 from Rs 100.22 trillion in FY24, while merchant TPV on increased to Rs 15 trillion in FY25 from Rs 11 trillion in FY24.
Company’s monthly active customers also increased to 230.08 million in March 2025 from 197.43 million in March 2024.