MobiKwik’s Financial Performance: A Deep Dive into Q4 FY25
Introduction
MobiKwik, a prominent fintech platform based in Gurugram, has recently reported its Q4 FY25 financial results. The company experienced a significant net loss of Rs 56 crore, a substantial decline from the Rs 67 lakh loss in Q4 FY24. This shift from profitability highlights the challenges faced by MobiKwik amidst rising costs and a struggling credit business. Despite these hurdles, the company saw substantial growth in its payments segment.
Focus on Payments Business
MobiKwik’s payments business showcased impressive growth, with gross merchandise value (GMV) soaring 203% year-on-year to Rs 1.16 lakh crore. Revenue from this segment more than doubled, reaching Rs 767.4 crore from Rs 317.1 crore in the previous fiscal year. This performance was attributed to:
- A 62% reduction in user incentives
- A 9% decrease in payment gateway costs
These measures helped achieve a gross margin of 19.7%, one of the highest in the sector. However, overall quarterly revenue growth was muted, with a mere 1.1% increase to Rs 267.78 crore, while expenses surged 22% to Rs 324.28 crore.
Challenges in Credit Business
The financial services arm, particularly the ZIP product, was a significant drag on MobiKwik’s performance. ZIP disbursals plummeted 41% year-on-year, from Rs 9,093 crore in FY24 to Rs 5,358 crore in FY25. The decline was due to:
- Reduced appetite from lending partners
- A strategic pause in new user onboarding for ZIP
This refocus on longer-tenure ZIP EMI products aimed at better risk-adjusted returns. Consequently, financial services revenue dropped 27.8% to Rs 402 crore.
Expansion of User Base and Merchant Network
Despite financial challenges, MobiKwik expanded its user base significantly, adding 4.45 million users in Q4 alone. By March 2025, the total user base reached 176.4 million, a 13% year-on-year increase. The company also onboarded 0.53 million merchants during FY25, expanding its network to 4.59 million, predominantly offline retailers.
Strategic Moves and Future Outlook
MobiKwik’s focus on leveraging AI for growth is a strategic move to accelerate market penetration, drive revenue growth, and enhance margins through intelligent automation. Upasana Taku, executive director, co-founder & CFO, highlighted the company’s commitment to these goals.
Moreover, MobiKwik’s payments subsidiary, Zaakpay, received RBI approval to operate as a licensed payment aggregator and gateway, which could further bolster its market position.
Comparative Insights
MobiKwik’s challenges are not unique in the fintech sector. Companies like Paytm and PhonePe have faced similar hurdles with balancing growth and profitability. For instance, Paytm’s focus on expanding its financial services has also led to increased operational costs, impacting its bottom line.
Conclusion
MobiKwik’s financial performance in Q4 FY25 underscores the complexities of the fintech landscape. While the company has made notable strides in its payments segment, the challenges in its credit business highlight the need for strategic recalibration. As MobiKwik continues to innovate and expand, the focus on sustainable growth and leveraging technology will be crucial.
What strategies could MobiKwik adopt to stabilize its financial performance? How will the evolving fintech landscape shape its future? Your insights and thoughts are welcome as we continue to explore the dynamics of this rapidly changing industry.
