PhonePe records 77% jump in FY23 revenues, claims payment business close to being EBITDA positive

Fintech major PhonePe has clocked a 77 percent year-on-year growth in its FY23 revenue at ₹ 2,914 crore compared to last fiscal year of ₹ 1,646 crore. The company has attributed its growth to — market expansion and leadership in the digital payments market, especially in major revenue-contributing use cases like Money Transfers, Mobile Recharges and Bill Payments.

The UPI Total Payments Value (TPV) market share of PhonePe stood at 50.54% in March 2023. The company said its payments business moving towards positive EBITDA (before ESOP costs).

“While EBITDA for the standalone PhonePe India entity (which houses our Payments business) stood at ₹ 1,755 crore in FY23 versus ₹ 1,612 crore in FY22, on an adjusted basis (excluding ESOP expenses), it stood at ₹ 159 crore in FY23 versus ₹ 455 crore in FY22, thus marking a significant milestone for our Payments business,” PhonePe said in a statement.

The digital payments service provider added that the revenue growth was also driven by the launch and scale-up of new products and businesses such as Smart Speakers, Rent Payments, and Insurance Distribution. PhonePe’s Smart Speaker deployment stands at 4.1 million as of August 31, 2023.

The fintech platform is planning for an IPO in 2024-2025. PhonePe secured an additional $200 million in primary capital from Walmart at a pre-money valuation of $12 billion in March. The funding was a part of PhonePe's ongoing capital raise of up to $1 billion, following its shift to India last year.

The homegrown digital payments decacorn had raised $350 million from General Atlantic in January and $100 million from Ribbit Capital, Tiger Global and TVS Capital Funds in February. With this funding round, the company has now raised $650 million from various global investors. The company expects further investments to be announced in due course.

Founded in 2015, PhonePe has over 490 million registered users. The company has digitized over 36 million offline merchants in Tier 2, 3, 4, and beyond, covering 99 percent of the country's pin codes. In April, the digital payments giant made its big e-commerce foray with the hyperlocal commerce app – Pincode – by going live on ONDC.