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) Apple Pay Eyes India Launch by Late 2026

Planned Rollout:

• Apple is working with Indian banks, regulators, and card networks (Visa, Mastercard) to introduce Apple Pay by the end of 2026.

• Initial focus on card-based contactless payments via Apple Wallet on iPhone and Apple Watch at NFC terminals.  

Regulatory & Market Context:

• Requires RBI approval; no immediate plan for UPI integration in phase one due to complex authorisation process.

• Builds on Apple’s strong Q3 2025 India shipments (5 million units, fourth market position) and growing installed base.  

Service Features:

• Will include Tap to Pay on iPhone for merchants; Indian-issued cards currently cannot be added to Apple Wallet.

• Fintechs like Cashfree Payments and Razorpay already support Apple Pay for international merchant payments.  

2) Infra.Market Receives SEBI Clearance for ₹5,000 Crore IPO

IPO Approval:

• Infra.Market secured SEBI nod for its ₹5,000 crore IPO, following confidential draft filing in October 2025.

• Structure includes fresh issue and offer for sale (OFS) in roughly equal parts.  

Recent Funding & Valuation:

• Raised ₹732 crore in September 2025 from founders, Zerodha’s Nikhil Kamath (NK Squared), Tiger Global, Accel India, Evolvence India Fund, and Nexus Ventures; valued at ~$2.8 billion.

• IPO managed by Kotak Mahindra Capital, IIFL Capital, Goldman Sachs, Jefferies, ICICI Securities, HSBC Securities, Motilal Oswal, and Nuvama Wealth Management.  

Business Snapshot:

• Founded in 2016, supplies construction materials (concrete, steel, pipes, plywood, appliances) to developers, contractors, and architects.

• Reported 27% YoY revenue growth to ₹18,472 crore in FY25.  

B) Economic Highlights

1) SMFG India Credit Ties Up with Google Pay for Instant Personal Loans

Partnership Details:

• SMFG India Credit (SMICC), an NBFC, partnered with Google Pay to offer collateral-free personal loans to users nationwide.

• Loans disbursed in minutes via end-to-end digital process within the Google Pay app.  

Strategic Focus:

• Targets underserved and emerging segments with fast, flexible, and hassle-free borrowing.

• Strengthens SMICC’s digital lending presence through technology and fintech alliances.  

Leadership Comment:

• Ajay Pareek, Chief Business Officer, highlighted the move as part of long-term strategy to expand reach, promote financial empowerment, and support digital inclusion.  

2) RBI Advocates BRICS Digital Currency Integration

Proposal Overview:

• RBI recommended linking BRICS nations’ central bank digital currencies (CBDCs) for efficient cross-border trade and tourism payments.

• Suggested placing the idea on the 2026 BRICS summit agenda (to be hosted by India).  

Potential Benefits:

• Faster settlements, lower costs, reduced US dollar dependence, enhanced transparency via blockchain.

• Programmable features for targeted use, curbing illicit flows, and supporting geopolitical alternatives to SWIFT.  

Challenges & Risks:

• Complex harmonisation of legal, regulatory, and technical frameworks; potential US scrutiny amid BRICS-related tensions.

• Builds on 2025 Rio summit interoperability declaration; requires consensus among members running CBDC pilots.  

C) Business Developments

1) Mysa Secures $3.4 Million in Fresh Funding Round

Funding Details:

• B2B fintech startup Mysa raised $3.4 million in a round co-led by Blume Ventures and Piper Serica.

• Other participants included Ikemori Ventures, Raise Financial Services, QED Innovation Labs, and existing investors Antler, IIMA Ventures, and Neon Fund.  

Cumulative Capital:

• Total funding now stands at $6.2 million, following a $2.8 million seed round led by Blume Ventures in February 2025.  

Platform Capabilities:

• Founded by Arpita Kapoor and Mohit Rangaraju, Mysa integrates with legacy ERP systems and banking infrastructure to automate finance workflows for mid-sized companies.

• Covers vendor management, accounts payable, expense management, GST ITC checks, and multi-bank payments.  

Growth Plans:

• Funds will expand automation features and launch new products: procurement tools, UPI-linked expense management, corporate credit cards, and embedded financing via vendor network.

• Currently processes over ₹1,500 crore in annualised transaction volume and handles payments to 40,000+ bank accounts with integrations across 15+ banks.  

2) PhonePe Sacrifices ₹1,500 Crore Revenue in Pre-IPO Strategic Reset

Revenue Trade-Off:

• PhonePe paused high-revenue segments (credit card rent payments and real money gaming) ahead of its IPO, resulting in an estimated ₹1,500 crore annual revenue loss.

• Rent payments contributed ₹1,262 crore in FY25 (9% of gross margins); RMG revenue dropped from ₹245 crore in FY25 to ₹71 crore in H1 FY26.  

Financial Snapshot:

• FY25 revenue from operations rose 40% YoY to ₹7,114 crore; H1 FY26 revenue stood at ₹3,918 crore with adjusted EBITDA of ₹254 crore.

• Maintained bank balances and investments exceeding ₹6,300 crore as of March 31, 2025.  

Strategic Rationale:

• Regulatory tightening (RBI norms on credit card rent and Gaming Act + higher GST) forced discontinuation of rent service and RMG monetisation.

• Aims to future-proof the business with stronger governance and sustainability ahead of public listing.  

D) Regulatory Insights

1) RBI Levies Penalty on Northern Arc Capital

Penalty Amount:

• RBI imposed ₹2.70 lakh penalty on Northern Arc Capital Limited on January 29, 2026, for non-compliance with KYC Directions.

• Violation: Failure to implement IT system/software for effective identification and reporting of suspicious transactions.  

Process:

• Penalty under Section 58G(1)(b) read with Section 58B(5)(aa) of RBI Act, 1934.

• Based on statutory inspection as of March 31, 2024, show-cause notice, and personal hearing.  

Scope:

• Action addresses regulatory deficiencies; does not affect validity of transactions or preclude further RBI measures.  

2) RBI Fines Rajapur Urban Co-operative Bank

Penalty Imposed:

• RBI levied ₹50,000 penalty on Rajapur Urban Co-operative Bank Ltd., Rajapur, Maharashtra, on January 23, 2026, for breaching loans and advances to directors/relatives/firms directions.

• Violation: Sanctioned a loan to the relative of one of its directors.  

Process:

• Penalty under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of Banking Regulation Act, 1949.

• Followed statutory inspection as of March 31, 2025, show-cause notice, and hearing.  

Scope:

• Action targets compliance lapses; does not impact transaction validity or rule out additional RBI actions.  

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.