PayU India, one of the country’s top digital payment and credit platforms, is poised to achieve EBITDA breakeven in the current fiscal year (FY26), according to CFO Anirban Mukherjee. This marks a significant milestone as the company navigates regulatory headwinds, restructures business operations, and focuses on operational efficiency across verticals.
After a turbulent period marked by non-bank lending restrictions and pullback in unsecured credit, the fintech giant is now aligning itself for sustainable growth, especially as the Indian government pushes for a more compliant digital finance ecosystem.
Background and Context
PayU India, a subsidiary of Dutch investment group Prosus, has been a dominant player in India’s payment gateway, merchant acquisition, and consumer credit space. It has also invested in various Indian fintech startups, including the now fully integrated LazyPay and PaySense.
In 2023, Prosus restructured its fintech portfolio by divesting non-core global assets to sharpen its India-first strategy. Now, PayU India is central to Prosus’ fintech vision, and breakeven goals are being driven by improvements in cost control, digital credit risk management, and tighter focus on compliance in the lending segment.
Strategic Highlights
Cost Optimization: PayU has significantly reduced operational expenditures through product consolidation and tighter credit underwriting protocols, especially post-RBI scrutiny on unsecured lending.
Revenue Quality Focus: CFO Anirban Mukherjee noted a deliberate move toward high-quality merchants, enabling PayU to stabilize revenue despite a saturated digital payments market.
Credit Realignment: The company has tightened its consumer credit business, especially through LazyPay, to reduce defaults and maintain unit economics.
Productivity Gains: Efficiency metrics such as cost-to-income ratio and transaction throughput per employee have improved across the board, according to internal data cited by Prosus.
Financial Snapshot (as of FY25 Year-End)
| Metric | Value |
|---|---|
| FY25 Revenue (India) | $400 million+ |
| YoY Revenue Growth | 25% |
| Payments Volume (TPV) | $55 billion+ |
| Credit Portfolio Size | ~₹2,000 crore |
| Expected EBITDA Breakeven | FY26 (March 2026 target) |
Expert Viewpoints
CA Manish Mishra, Fintech Audit Specialist:
“PayU’s operational pivot and focus on compliance come at a time when many NBFC-backed fintechs are under the RBI lens. Achieving breakeven in FY26 not only builds investor confidence but also positions them for potential IPO discussions.”
CA Manoj Kumar Singh, Financial Analyst & Partner at MKP Advisors:
“EBITDA breakeven is meaningful in a high-burn sector like fintech. The ability to scale sustainably in lending and payments while staying profitable could set PayU apart, especially as global investors re-evaluate their Indian exposure.”
Market Implications
Valuation Uplift for Indian Fintech: Breakeven expectations will positively influence the valuation narrative for Indian fintechs, particularly those eyeing capital markets in FY26–27.
Investor Re-entry: A profit-oriented fintech strategy could bring back late-stage venture investors, who had pulled back post-2022 funding winter.
IPO Pathway Activation: With several fintech players like MobiKwik, PhonePe, and Cred in pre-IPO phases, PayU’s EBITDA milestone might reignite conversations around prospective listings in the payments + lending space.
Conclusion
PayU India’s EBITDA breakeven goal for FY26 signals a larger structural shift in the Indian fintech ecosystem—from growth at all costs to sustainable, profitable scaling. With strategic cost discipline, focus on compliant lending, and robust payment volumes, PayU is repositioning itself not only as a market leader but also as a blueprint for how fintechs can thrive under regulatory scrutiny.
As investor sentiment recovers, and India continues to be a global fintech hub, PayU’s financial discipline could become the benchmark for resilience and readiness in the sector.
