PhonePe reduced its net loss by 29% in the last fiscal year to Rs 1,996 crore, down from Rs 2,795 crore in FY23. According to the company's most recent annual report, the improved financial performance was supported by a 74% increase in operational income to Rs 5,064 crore in FY24, up from Rs 2,914 crore the previous year.
PhonePe reported an adjusted net profit of Rs 197 crore in the last fiscal year, removing charges for employee stock ownership plans (ESOPs), indicating that its core operational business has begun to turn profitable.
In FY24, the digital payments firm's total expenses increased by 31% to Rs 7,756 crore. This was mostly owing to a 16% increase in personnel expenses, totaling Rs 3,603 crore.
Payment processing charges—the fee that payment businesses must endure for resolving digital transactions with banks—increased by 75% to Rs 1,166 crore last year.
PhonePe reduced its financial sheet in terms of cashback and incentive-based expenses, spending only Rs 15 crore on payment incentives in FY24. The Bengaluru-based business spent Rs 950 crore in FY19, during the zenith of the cashback competition between Paytm, Google Pay, and PhonePe, according to the report.
According to the corporation, a variety of variables, including income stream diversification through mutual fund distribution, ecommerce, credit, and other initiatives, aided the company's revenue stability and excellent development.
PhonePe is also expanding its revenue channels by offering sound boxes and POS machines to its more than 40 million merchants. According to the corporation, government-provided MDR-related incentives currently account for 10% of its total income.
MDR, or merchant discount rate, is the fee retailers pay to payment processors in exchange for digital payment services.
PhonePe reduced their customer support personnel to roughly 400 people from over 1,100 five years ago. It has also automated 90% of customer inquiries, hence reducing overhead costs.
"Our mission is to create digital platforms that help Indian citizens improve their lives and achieve their goals. The future lies in free market competition, which is driven by product innovation and customer service excellence. Transparency is essential, which is why we are pleased to present our first annual report," stated Sameer Nigam, CEO of PhonePe.
