Jio Financial Services Incorporates New Subsidiary To Push For Financial Products Distribution Biz

Fintech platform Jio Financial Services Limited (JFSL) has incorporated a new wholly owned subsidiary, Jio Finance Platform and Service Limited.

The company has formed the new subsidiary for the business of distribution of financial products and allied services, it said in a filing on Thursday (August 15).

JFSL plans to invest INR 1 Lakh as initial subscription for 10,000 equity shares, each with a face value of INR 10.

JFSL received the certificate of incorporation from the Ministry of Corporate Affairs yesterday. The company clarified that this transaction does not fall under related party transactions and requires no governmental or regulatory approvals.

In its filing, JFSL further said that the promoter, promoter group, and group companies have no interest in the incorporation of this new subsidiary.

This development comes as JFSL continues to expand its presence in the financial services sector. The company, which demerged from Reliance Industries Limited in 2023, operates in various financial areas including payment services through Jio Payments Bank, insurance broking, and asset management.

This development follows JFS launch of the beta version of the JioFinance app. It provides digital banking services, such as UPI, mutual fund loans, and plans to expand into home loans in the near future. The app has already gained traction with 5 lakh downloads in July 2024. 

The company’s recent financial results show a slight dip in profits. For Q1 FY25, JFSL reported a consolidated net profit of INR 313 Cr, down 5.7% year-on-year from INR 332 Cr in Q1 FY24. However, operating revenue increased marginally to INR 418 Cr from INR 414 Cr in the same period.

In a regulatory development, JFSL received RBI approval in July to convert from a non-banking financial company (NBFC) to a core investment company (CIC). This change is expected to impact the company’s operational structure.