Fintech Companies - MUST READ

Happy Weekend everyone!

Today I am back with another weekly update for the Fintech Companies.

Covering updates in the regulatory or economic side of the Fintech market for Indian companies.

If you run a Fintech Company in India.

Or you plan on expanding your Fintech Company in India.

Then this becomes important for you.

Here are the main things that happened in the last week.

A) Emerging Trends

1) PayU Secures RBI Payment Aggregator License

Regulatory Milestone:

• Prosus-backed PayU received final RBI approval in May 2025 to operate as an online payment aggregator under the Payment and Settlement Systems Act, 2007, following in-principle approval in April 2024, per Silicon India and Inc42.  

• Joins 50+ approved aggregators like Razorpay and Cashfree, enabling merchant onboarding and digital payment expansion.  

Strategic Context:

• Overcame 2023 RBI rejection due to complex corporate structure by selling global fintech assets to Rapyd for $610M, excluding India operations.  

• Raised ₹1,013 Cr from Prosus in April 2025, eyeing a 2025 IPO at $5-7B valuation, with a 28% revenue jump to $319M in H1 FY25.  

Why It’s Significant:

• Strengthens PayU’s role in India’s digital payments ecosystem amid stricter RBI norms.

• Bolsters IPO prospects, enhancing merchant services and real-time payment capabilities via a 43.5% stake in Mindgate Solutions.  

2) Krypton India’s NBFC & Fintech Summit 2025 Shines

Event Overview:

• The 3rd NBFC & Fintech Leadership Awards 2025, hosted by Krypton India on May 9 in Mumbai, drew 200+ leaders for panels, awards, and networking, per Business Wire India.

• Chief Guest Sameer Unhale, Maharashtra Joint Commissioner, highlighted fintech’s role in smart cities and urban inclusion.  

Key Highlights:

• Featured 4 CXO-led panels, a corporate showcase by Alohaa.ai’s Thrivikram Gadam, and awards like Visionary NBFC Leader (Sumit Saha, Mahindra Finance) and Best Digital Lending Platform (Knight FinTech).

• Speakers included Easiloan’s Pramod Kathuria and Cashfree’s Rohit Katyal, discussing innovation and collaboration.  

Why It’s Significant:

• Fosters strategic partnerships and celebrates excellence in India’s NBFC and fintech sectors.

• Reinforces Mumbai’s position as a financial hub, driving digital transformation dialogues.  

3) Groww Settles SEBI Case for ₹48 Lakh

Regulatory Action:

• Groww paid ₹47.85 lakh to SEBI to settle violations found in a 2024 inspection, including incorrect account details, non-broking services, and inadequate BCP reviews, per MediaNama.

• Settled without admitting fault, but SEBI can reopen if terms are violated, following a ₹34.12 lakh penalty for a January 2025 trading glitch.

Market Context:

• Faces scrutiny as an IPO-bound platform, alongside peers like Zerodha, amid rising investor reliance on digital brokers.

• Recent price mismatch issues and a ₹9 lakh settlement for disclosure lapses add to regulatory challenges.  

Why It’s Significant:

• Highlights SEBI’s focus on fintech compliance, critical for investor trust.

• Raises governance concerns for Groww’s IPO plans, despite shifting HQ to India for listing.  

4) PB Fintech’s Q4 Profit Soars 3x to ₹170 Cr

Financial Performance:

• PB Fintech, parent of Policybazaar and Paisabazaar, reported a 38% revenue rise to ₹1,507 Cr and a 3x profit jump to ₹170 Cr in Q4 FY25, per Economic Times.  

• FY25 profit surged 439% to ₹345 Cr, driven by Policybazaar’s ₹7,030 Cr insurance premiums and Paisabazaar’s ₹7,652 Cr credit disbursals.  

Business Growth:

• Policybazaar’s new initiatives (agent networks, corporate health) generated ₹631 Cr, while Paisabazaar doubled secured loan disbursals, issuing 500,000 credit cards annually.  

• PB Pay’s RBI in-principle approval as a payment aggregator in April 2025 enhances digital payment capabilities.  

Why It’s Significant:

• Demonstrates robust growth in insurance and lending, bolstered by digital adoption.

• Positions PB Fintech as a fintech leader, with regulatory nods fueling expansion.  

B) Economic Highlights

1) Credit Saison India Raises $150M ECB from Mizuho

Funding Milestone:

• Credit Saison India secured $150M in External Commercial Borrowing from Mizuho Bank via its GIFT City branch, with a 5-year tenor, per IndianWeb2.

• Follows Mizuho’s 15% equity stake ($145M) in 2024 and $300M in prior ECBs, totaling $450M in Q1 2025.  

Strategic Impact:

• Bolsters CS India’s AAA-rated funding mix, supporting MSME and secured lending via co-lending and direct operations.

• Diversifies funding with bonds, commercial papers, and 35+ local lenders, enhancing financial resilience.  

Why It’s Important:

• Fuels Credit Saison’s expansion in India’s growing NBFC market.

• Strengthens Japan-India financial ties, supporting MSME credit access.

2) SIDBI Report: MSMEs Embrace Digital, Face Credit Gaps

Key Findings:

• SIDBI’s report, based on a 2,000+ MSME survey, notes 6.2 Cr Udyam registrations by March 2025, with 18% using digital lending and 90% accepting online payments, per Economic Times.  

• A 24% credit gap (₹30 lakh Cr) persists, higher for services (27%) and women-owned MSMEs (35%), with 12% of micro-enterprises relying on informal credit.  

Challenges & Opportunities:

• Women-led MSMEs (26.2% of proprietary enterprises) face credit access issues, while 70% of MSMEs stick to traditional marketing, limiting scalability.

• Exporting MSMEs (45.7% of FY24 merchandise exports) adopt tech faster but cite supply chain and skilled labor shortages.  

Why It’s Important:

• Highlights digital adoption as a growth driver for MSMEs, with UPI enabling credit access.

• Signals need for targeted policies to close credit gaps, especially for women entrepreneurs.  

3) Moneyview Preps for ₹3,400 Cr IPO

IPO Plans:

• Moneyview, a Tiger Global-backed fintech unicorn, appointed Axis Capital and Kotak Mahindra for a $400M+ (₹3,411.3 Cr) IPO, including fresh and OFS components, per Inc42.  

• Aims to leverage India’s booming IPO market, following rivals like Razorpay and PhonePe.  

Business Growth:

• Expanded from personal finance to digital lending, UPI, and gold SIPs, with ₹15,000 Cr in assets under management by FY25.  

• FY24 net profit rose 5% to ₹171.2 Cr, with revenue up 75% to ₹1,012 Cr, bolstered by its 2024 acquisition of Jiffy.  

C) Business Developments

1) Prateek Pathak Shapes Branch India’s Marketing Strategy

Career Insights:

• Prateek Pathak, Head of Marketing at Branch International (India), leverages experience from digital platforms (Times Internet), luxury hospitality (Fairmont), and fintech (ET Money, Stashfin) to drive Branch’s strategy, per Adgully.

• Key lessons include customer-centricity from hospitality, agility from digital brands, and compliance focus from fintech, shaping user trust and education.

Marketing Approach:

• Uses performance marketing (Google UAC, Meta, affiliates) to acquire high-intent users, with personalized retargeting for engagement and loan cycles.

• Balances short-term ROI via performance campaigns with long-term brand equity through SEO, content, and partnerships with financial marketplaces.

Why It’s Notable:

• Enhances Branch’s reach in India’s mobile-first market, targeting tier 2 and 3 cities.

• Combines data-driven precision with storytelling for impactful financial inclusion.

2) MOS Utility Launches Q-BRIDGE Fintech Solution

Service Introduction:

• MOS Utility’s Q-BRIDGE platform offers financial services like IRCTC train ticket booking, targeting rural simplification, per India TV News.

• Stock rose 2.17% to ₹293.50, hitting ₹298.50, trading above key moving averages, with a 52-week range of ₹150-374.95.

Market Context:

• Launched amid a weak market, with Sensex down 252.97 points and IT stocks dragging indices, though Bajaj Finance gained.

• Aims to unify financial services, enhancing accessibility in underserved areas.

Why It’s Notable:

• Expands MOS Utility’s fintech footprint, catering to rural digital needs.

• Reflects investor optimism despite broader market dips, signaling growth potential.

D) Regulatory Insights

1) Deutsche Bank AG, India Fined ₹50 Lakh

Penalty Details:

• RBI imposed a ₹50 lakh fine on Deutsche Bank AG, India on May 13, 2025, for failing to report certain borrowers’ credit information to CRILC, per RBI press release.

• Violation found during the 2024 Statutory Inspection, with penalty under the Banking Regulation Act, 1949, after a show-cause notice and hearing.

Context:

• Targets compliance lapses, not customer transactions, with potential for further RBI actions.

• Reflects RBI’s focus on accurate credit reporting for systemic stability.

Why It’s Important:

• Enforces robust data reporting, critical for financial oversight.

• Signals RBI’s stringent monitoring of foreign banks’ compliance.

2) Yes Bank Penalized ₹29.6 Lakh for Disclosure Issues

Penalty Details:

• RBI fined Yes Bank ₹29.6 lakh on May 16, 2025, for incomplete disclosure of customer complaints in its FY24 financial statements, per RBI press release.

• Followed 2024 inspection findings, with penalty under the Banking Regulation Act, 1949, after notice and submissions.

Context:

• Addresses regulatory deficiencies, not transaction validity, with possible additional actions.

• Part of RBI’s push for transparent financial reporting.

Why It’s Important:

• Ensures accountability in customer grievance reporting, boosting trust.

• Reinforces RBI’s oversight of private banks’ disclosure standards.

3) Grewal Brothers Finance Faces ₹50,000 Fine

Penalty Details:

• RBI levied a ₹50,000 penalty on Grewal Brothers Finance Company, Kerala, on May 9, 2025, for changing over 30% of directors without prior RBI approval, per RBI press release.

• Violation of 2023 NBFC-Scale Based Regulation Directions, confirmed after notice and hearing, under the RBI Act, 1934.

Context:

• Focuses on governance compliance, not customer agreements, with scope for further action.

• Highlights RBI’s scrutiny of NBFC management changes.

Why It’s Important:

• Upholds governance standards in smaller NBFCs, ensuring stability.

• Reflects RBI’s proactive enforcement in the non-banking sector.

4) Karnataka Central Co-operative Bank Fined ₹2 Lakh

Penalty Details:

• RBI imposed a ₹2 lakh fine on Karnataka Central Co-operative Bank, Dharwad, on May 9, 2025, for sanctioning director-related loans, violating the Banking Regulation Act, 1949, per RBI press release.

• NABARD’s 2024 inspection triggered the penalty, confirmed after notice and hearing.

Context:

• Targets statutory breaches, not transaction validity, with potential for additional measures.

• Emphasizes RBI’s focus on ethical lending practices in co-operative banks.

Why It’s Important:

• Curbs conflicts of interest, protecting co-operative bank integrity.

• Reinforces RBI’s regulatory grip on regional banking compliance.

I hope this was useful to you guys working in the Fintech Space.

The fintech space is everchanging, so staying up to date with information will help you make smart decisions for your business.

Again, If I see any notable changes or updates on the Fintech Side during the week, that can help Fintech Companies, I will compile them.

And then share them on the weekends!

Btw - I run a legal firm that's a one-stop solution for Fintech Companies in India.

Whether you are starting out in India, or expanding to the Indian market, DM 💬 me if you need legal help with:

1) Business Registration

2) Contract Drafting or Review

3) Compliance

4) Answering any legal questions

See you tomorrow with another Newsletter now.