SUMMARY
Prosus said in its annual report that PayU’s top line growth was fuelled by continued growth in enterprise and SME businesses, as well as diversification into newer segments
PayU’s revenue growth slowed in FY23 compared to over a 40% jump it saw in its revenue in FY22
On a consolidated basis, PayU’s revenue grew 32% to $903 Mn in FY23 globally
Prosus-owned PayU India registered a 31% year-on-year (YoY) rise in total revenue to $399 Mn in FY23, as per the annual report of the investment arm of South African multinational Naspers.
Prosus said in its annual report on Tuesday (June 27) that PayU’s top line growth was fuelled by continued growth in enterprise and small and medium-sized businesses, as well as diversification into newer segments, including government merchants, omnichannel and other non-MDR (merchant discount rate) products.
However, it must be noted that the growth was slower compared to over a 40% jump in revenue that the fintech unicorn reported in FY22.
PayU India’s total payment value (TPV) also saw a 33% growth to $58 Bn, driven by transaction growth of 25% to $1.4 Bn, as per Prosus’ report. However, this growth was also slower compared to last year’s 44% jump.
It is pertinent to note that the Reserve Bank of India (RBI) asked PayU to reapply for payment aggregator (PA) licence earlier this year, which is expected to have affected its business in the March quarter of FY23.
Besides, PayU’s Indian credit business continued to scale during FY23, issuing $742 Mn of loans, up 47% YoY. Its loan book stood at $256 Mn as of March 31, 2023, said Prosus.
“The credit business grew revenue three times to $83 Mn, largely through growth in personal loans. The trading loss of $10 Mn represents a 63 percentage point improvement in margin to -12%, reflecting an improved loss rate of 2.5% from 3% in FY22,” said the global investor giant, adding that the business is close to breakeven.
Following RBI’s directions disallowing loading of non-bank prepaid payment instruments (PPI) with credit lines, PayU had to stop its digital bank offering, LazyCard, in FY23. This contributed to the largest part of the trading loss in PayU’s credit business’, said Prosus.
On a consolidated basis, PayU’s revenue grew 32% to $903 Mn in FY23, said Prosus. Trading loss stood at $83 Mn during the year as against $46 Mn in FY22.
Besides India, PayU operates in over 50 countries across Latin America, Europe, Asia, and Africa. Reports emerged recently that Prosus was planning to gradually sell PayU’s global operations to different buyers while retaining its Indian business.
PayU is a leading payments solution provider, which claims to offer its solutions to over 5 Lakh businesses in India. The B2B payments startup enables businesses to collect online and offline payments via more than 150 payment modes, including debit cards, credit cards, net banking, BNPL, QR, UPI, EMIs, and wallets.
As per PayU’s financial report, its India business turned profitable in FY22 with a profit of INR 126 Cr ($15 Mn approx.). Its revenue stood at INR 2,130 Cr (over $250 Mn) in FY22.
