PayU India’s Revenue Jumps 20% in H1 FY26 on Payments & Credit Growth

Fintech platform PayU India reported a 20% increase (year-on-year) in revenue to $397 million in the first six months of the current financial year. The start-up attributed the growth to its payments and credit businesses along with the rising contribution from higher-margin value-added services.

Its payment vertical is the largest revenue driver, which posted a 20% rise to $301 million in the six-month period ended September. Prosus, in a half-yearly filing, noted that value-added offerings such as fraud-prevention tools, multi-factor authentication and SaaS-based services now make up 34% of total payments revenue, aiding margin expansion.

The start-up’s overall payment volumes surged 55% during the period, propelled mainly by the rapid growth of smaller-value UPI transactions. Despite the increasing share of UPI, the company reported steady take rates, supported by deeper penetration into mid-market, and small and medium businesses.

The improvement came after several quarters of slower expansion and regulatory uncertainty for PayU in India. During the second quarter of the ongoing financial year, the company swung to a positive adjusted Ebitda of $3 million at the consolidated level, reversing the $4 million loss posted in the preceding quarter.

It has also received the Reserve Bank of India’s nod to function as a payment aggregator, clearing the way for it to process online, offline and cross-border transactions.

PayU FY25 Financials

Founded in 2002 and spun out of Ibibo in 2014 under the leadership of co‑founders Nitin Gupta and Shailaz Nag, PayU India operates two primary segments: payment gateways and digital financing. The payments division, which reached profitability in the second half of FY 2025, saw a 12% year‑on‑year sales increase to $498 million.

The credit vertical delivered even stronger growth, with revenue rising 60–63% to $171 million and loan disbursements totalling $1.1 billion in FY 2025, growing its loan book to $558 million by year‑end.

Despite these gains, PayU's adjusted EBIT (aEBIT) widened to $44 million in FY 2025 from $32 million in FY 2024, driven in part by higher financial leverage and elevated loss rates in its consumer loan portfolio.

To address this, the company has tightened underwriting criteria, shifte dfocus toward partnerships and SMB lending at checkout, and leveraged the RBI's April 2024 approval to resume merchant onboarding and operate as a regulated payment aggregator, actions that added some 13,000 new merchants in FY 2025.

In April, PayU received approval from the Reserve Bank of India (RBI) to operate as a payment aggregator, enabling the digital financial services provider to onboard new merchants following the in-principle approval.

This decision follows the RBI's heightened scrutiny of the payments sector, requiring online payment companies to monitor merchants' transaction-related activities and ensure compliance with updated guidelines.