Thank you, Swapnali. Good evening, everyone.

On behalf of Dolat Capital, I would like to thank One MobiKwik Systems for giving us the opportunity to host this earnings call. I welcome the senior management of the company represented by Mr.

Bipin Preet Singh, MD and CEO of the company; Ms. Upasana Taku, who is Executive Director and CFO of the company.

Now I would like the management to take us through Q4 FY26 results, and I request management to take it over from here. Over to you now.

Thank you, Rahul. A very good afternoon to all the people who have joined, all the participants on our call today.

This is Upasana. Q4 FY26 was a landmark quarter for MobiKwik.

We ended the year with back-to-back profitable quarters. The full year financial year '26 was an inflection year for us.

We achieved an EBITDA of almost near breakeven, -₹5 crores, with a total swing of ₹742 million from -₹794 million in FY25 to -₹52 million in FY26. The full year PAT halved to -₹621 million, an improvement of ₹594 million year-over-year from the previous financial year where it was negative ₹1,215 million.

The payments GMV hit an all-time high of 524 billion rupees in the fourth quarter, which is 58% YoY improvement and 9% QoQ improvement. This is the 13th consecutive quarter of record high GMV that the company has reported in the payments business.

Within payments, in wallet, we remain the largest wallet in India by GTV as of March 2026, with about 20% market share. In UPI, we are the second-fastest growing UPI app in India now.

Our customer-initiated UPI transactions grew 170% year-over-year versus the industry which grew at 26% year-over-year, which is we grew 6.5 times the market rate. In bill payments, Bharat BillPay, we are the sixth largest customer operating unit by GTV as of March '26.

In our overall recharge and bill payments business, which is a mature business for us, the total GMV scaled 2.2x to ₹269 billion in the full financial year '26. We reported a 48% 3-year CAGR in this business.

To clarify, the BBPS COU GTV is a subset of the recharge and bill payments GMV that I just cited. In our financial services business, we delivered our highest ever quarterly gross margin at 59% in Q4, which indicates our objective of disciplined expansion, profitability prioritized over volume.

Our focus here has remained on increasing disbursements to super-prime and repeat users. Super-prime customer mix improved year-over-year from 10% to 32% in the total disbursements, while repeat loans went up from 20% to 63.5%.

At a consolidated level, in Q4 the total income came at ₹2,960 million, which is a 6% improvement year-over-year. Contribution margin expanded to 46%, nearly double of the 23% we had posted in Q4 financial year '25.

The EBITDA for the quarter came in at ₹174 million, which is a 5.9% margin, reflecting a ₹632 million year-over-year swing. The reported PAT of ₹44 million for the quarter includes a ₹37.6 million one-time exceptional charge due to the changes in the Labor Wage Code.

Without this exceptional item, our underlying PAT would have been ₹81 million for the quarter. In a summary, FY26, in the first half, we were catching up, we were rebuilding credit quality, compressing costs, and restoring our margins.

By H2, the business had fully turned. H2 delivered an ₹84 million cumulative PAT, and both Q3 and Q4 were EBITDA and PAT positive as we had committed to all of you in the last few earnings calls.

The trajectory entering financial year '27 is therefore much stronger than what our full-year numbers indicate. The right way to think about FY26 is this: MobiKwik now has a core business which is generating real profits—₹50 crore of EBITDA is what our core business, payments and lending, has generated—and now we are deliberately reinvesting these profits towards building new growth engines.

To be specific, we are focused on four new growth engines. The first two are merchant payments, offline and online.

Together, they represent what we believe is a single largest untapped opportunity in the Indian payments ecosystem. Merchant payments, both offline merchant payments and online merchant payments, operate on MDR, device, and settlement economics with significantly less competition than what we see in consumer payments.

Our offline merchant payment business is targeting a 5x device scale-up to enable a 10x revenue growth by financial year '28. Our online merchant acquiring business, Zaakpay, housed in our wholly owned subsidiary, is targeting a 10x GMV by financial year '28.

In the payments business, GMV growth precedes revenue. The revenue from what we have already invested is in the pipeline, and it will start reflecting in financial year '27.

Both merchant payment businesses are on track for EBITDA breakeven by financial year '28. The third growth engine is our NBFC application approval, which is the most consequential regulatory milestone in our lending journey.

The NBFC helps us establish the right foundation to continue our lending scale-up in the most regulated model available in this country. The strengths that we have built in doing digital lending in the last 7 years include underwriting and credit risk expertise, our collections has been tested in stress cycles, and our lender partnerships are in place, all of which will seamlessly transition from our current lending service provider, LSP model, to the new NBFC co-lending model.

The NBFC will unlock better economics both on own-book as well as in co-lending, where we will be able to partner with many more partners in the banking and NBFC sector. We'll be able to get better terms on FLDG, and we will have an access to much larger universe of regulated PSU and private sector banks.

Beyond just the economics, the NBFC will also provide us product velocity. As an LSP, every product decision goes through lender approval cycles, and we build what they can sanction.

As an NBFC, we will design products on our own timeline. The fourth and final growth engine is AI.

MobiKwik as a company intends to be an AI-first company by financial year '28. We are already running AI across the business: 80% of code is AI-generated, 55% of early collections are AI-driven, and 86% of customer support is self-served by AI.

We are going further. AI will own the full lending life cycle.

It will identify funnel drops, drive user personalization at scale, and acquire better cohorts at lower spend. It will also help us detect frauds in real time.

For us, AI is not just a productivity tool; it is a compounding competitive moat. With that, I'll end my opening speech, and we'll open it up for questions.

Am I audible?

Hello? Yeah.

Ma'am, our payments business from last 4 to 5 quarters is struggling to grow in terms of revenue. What are we doing about this excluding our new growth engines, and do you expect it to cross ₹220, ₹210 crore revenue per quarter anytime soon?

Hello?

Just 1 second. Yes, as I just explained in my opening speech, in payments, revenue generally follows GMV.

There is substantial GMV growth that we are showcasing in the payments businesses across all the businesses of wallet, of UPI, bill payments. The margins that we are earning from payments have also increased.

Of course, there is more UPI mix in the overall payments GMV, due to which we have so far not been able to demonstrate significant revenue growth, but like I mentioned, we have invested and we will be delivering growth in the coming years and quarters.

Any long-term guidance for our payments revenue growth? See,

basically what Upasana is saying is that here the revenue is going to lag the GMV growth simply because a lot of growth is happening around the UPI, and as we have mentioned, we have grown 170% on UPI over the last year or so. Even our wallet has grown, but the wallet has grown over UPI, and that PPI over UPI MDR, which is supposed to come has not yet come, and we are expecting it to come.

Because of that, there is a revenue lag, but you will see consistent growth in the revenue follow the GMV growth in the next few quarters.

Okay. I have some doubts regarding FLDG.

FLDG cost, which is majority part of our lending-related expenses, is actually not a cost, right? This amount gets blocked, and if lender doesn't default, it comes back to us.

Am I right?

No, it's not correct. It's actually, you have to bear the up to the 5% kind of a cost.

The exact mechanism of how it gets settled is different, but whether it gets invoked or not, but basically the 5%—if your credit cost is 5%, then the 5% has to come out of the economics.

It doesn't really

come to us also because it's blocked, you are right, but it is part of the overall economics.

If it doesn't get invoked, then what happens with that?

As your book is growing, let's say you have ₹100 crores of book, against that you have ₹5 crores of FLDG. Next month you have ₹200 crores, you have ₹10 crores of book.

You basically against the future losses that are coming, you have to keep depositing more and more FLDG. If, for example, the business de-grows for some reason, then you will start getting the money back.

Okay. Got it.

At that time, yeah.

Yeah. Sir, regarding our high debt and interest costs, you have mentioned that it is working capital due to some settlement with merchants.

Can I infer that our peer who has zero debt and is funding all these through its cash, and why we are not doing the same? We have also some cash on our books.

Hi. See, I'm happy to inform that whatever long-term debt we had, we have already paid it off.

The only remaining and utilized debt as of 31st March is ₹261 crore of working capital lines. These are short-term working capital lines which we generally use for the weekends and long weekends specifically.

You're right, we can fund it with our own cash also because our net owned cash is about ₹434 crores. However, not all of our cash has been available to us at all times.

Out of this, a good chunk of cash is still in the IPO proceeds, and therefore not all of that cash is available to us as yet. We do utilize the working capital lines very prudently, and if you can see the disclosure on the debt both on quarterly basis and annual basis has come down significantly from the previous financial year.

Okay. You have mentioned that our merchant business will scale 10x and then we will break even.

Why it has to scale 10x and then break even? In between, 10x is a big number, right?

Why break-even is taking it to scale 10x?

Yeah. Look, again, it's a more forward-looking, longer-term projection.

The thing is that what we are trying to say is that obviously you can break even earlier at a smaller scale. Break-even here means that actually it completely turns and it becomes profitable on its own.

If you continue to expand and invest where a lot of the cost comes in terms of how you are expanding the network, right, in terms of the number of people that you have on the ground running sales, because it's sales-heavy and operations-heavy, then if you are aiming for a certain scale until you reach that scale and stabilize that scale, then until then it stays kind of in the negative territory. Once you have reached that scale, which is what we are targeting, then it just immediately is followed by stabilization of margins and breakeven.

To give you an example, we could very well target 3x or 4x growth and breakeven much earlier. Again, if we get into the investment cycle, we will have to invest because basically the investment and the return on investment in terms of the margins and the revenue, there is a lag.

We have taken this call that the right level to target is 10x, and the reason we have taken this call is because we see enough execution rigor that has been achieved in the business already, and also the product and the competitiveness of our offering has reached a level where we can get to 10x without having to change anything else. We've taken this clear call.

Okay. Fair enough.

My last question is regarding interest costs. We are profitable now, we are generating some cash also.

Can we expect that interest costs to come down because it is a huge number which eats our profitability?

Yeah. The interest cost, like Upasana is saying, coming from the working capital, and that working capital is a necessary evil in our business because you have to fund it with bank-based debt lines.

Say, for example, you have 2 days bank holidays, then the volume of settlements runs into hundreds of crores.

Just to also explain that we are trying to bring it down. If you see that in quarter 4, the finance cost is ₹5.1 crore versus it was ₹7.2 crore in Q3.

We are definitely trying to bring down the finance cost.

Okay. Thank you.

Thank you for taking my question. You are venturing into this merchant acquisition process and all.

In next 2 years, how much investment we need to make for that, and will that be routed through P&L, or in fact, I think we had raised money in IPO for this particular object also, will it be used from there?

Hi Sunil. As I mentioned, what we are doing is we are trying to generate margins from our scale businesses, which are lending and consumer payments, and from that, we are trying to reinvest into building the merchant payments business.

We will continue investing into this for the next at least 18 months. We expect that investments will be required before these businesses start becoming close to breakeven.

To answer your question, we did raise funds in the IPO proceeds also for this, we will be utilizing it from the IPO proceeds also, but in that case also, it will hit the P&L because there is no concept of capitalization for these expenses.

You will be giving this Soundbox and all, so that will not be considered capital expenditure? Means that will be more of a subscription-based you will be giving to the customers?

No, the devices piece, we are putting it in depreciation, which you can see that depreciation costs are going up only. Only the device piece.

Outside of that also, there is investment in manpower, there is investment in the product that we are building. Outside of the device capitalization, which goes into the depreciation cost, everything else is directly hitting the P&L.

Can you quantify how much could be the investment?

For financial year '26, which we are just closing, we have mentioned that we have invested ₹55 crores. Had we not invested that, our EBITDA would not be negative ₹5 crores, it would be positive ₹50 crores.

For coming year, any figure?

In similar range.

Fine. Great.

Thank you very much.

Hi. Thank you for taking my question.

Firstly, I was trying to get a sense that last quarter we had this commentary that the fixed cost base is expected to settle between ₹105-₹110 crores, and that we are investing around ₹10-₹15 crores, we are burning ₹10-₹15 crores on the merchant business which we expect to sort of reach breakeven in 3-4 quarters. If I look at this quarter, I think the fixed cost base is grown to 120—above ₹120 crores, and the commentary now is that we expect merchant business sort of reach breakeven in FY28.

Just wanted to get a sense of what has changed and what is driving this. At the same time, one of the commentary that you specifically mentioned in the presentation is that you expect to remain baseline profitable over next 2 years.

Can you highlight what do you mean by this?

Hi. Actually, these are two different questions.

Firstly, yes, we are saying that we are making fixed cost increases on purpose to build the new businesses which I highlighted at the beginning of the call, and it's also detailed out in our earnings presentation. To qualify, if I tell you that in Q4, we have reported ₹117 crore in fixed cost, which is about ₹4 crores higher than last quarter, and we've also mentioned that in this quarter, we have taken the new wage code related hit, which is almost ₹4 crores, ₹3.8 crore if I'm not wrong.

The gap between Q3 and Q4 is just that much, which is the new wage code related provision that we have taken. Now outside of that, when we are saying that we will be baseline profitable, what do I mean by that?

What I mean is that we are generating profit margins from our baseline business of consumer payments and lending, which are our scale businesses. We are redeploying, reinvesting some of that and building the new businesses.

Despite making that investment, we have ensured that we are PAT profitable for the quarter by ₹4.4 crores. What we are trying to say is that in financial year '27, we will have these new businesses which will scale, which we want to build new moats, new verticals.

Those businesses also, as they scale, their burn will keep going down. At all times, we intend to be profitable at the bottom line.

That is definitely our intention, is what we are saying. Which means that same thing that I'm saying this financial year, had I not invested in building a merchant payment business, I would have reported a plus ₹50 crore EBITDA instead of reporting a negative ₹5 crore EBITDA for the full financial year '26.

I'm trying to say that in FY27, let's say hypothetically I could have reached a 2x positive EBITDA, I may not reach 2x, I may reach x or x plus something, because the balance between x and 2x I would have invested in continued investments in building these businesses so that in 2 years' time they will also become 10%, 20% of the revenue pie of the company.

Right, right. The broad sense would be that I think to the earlier participant you sort of mentioned that you expect similar kind of investment in the merchant business as FY26 going into FY27.

If that is going to be the case and the fact that you mentioned that as these businesses scale you expect them to sort of reduce the burn, ideally the profitability should see sharp improvement going ahead, right, despite these investments being there? Because the core business either ways is substantially profitable, assuming that the fixed cost base doesn't grow for that business.

I think we're both saying the same thing.

Okay. Maybe I have a different read of the wording.

No, I'm trying to say that the core business will also scale up, the net new businesses will also start generating revenue, and as a result of that, we expect that the company's overall revenue will grow while maintaining the current profitability, which is baseline profitability. We are not reporting right now 10% PAT; we are reporting 1% PAT.

That is what we are trying to say, that with a very moderate baseline profitability, we will further scale up the business, both existing businesses and net new businesses.

Got it, got it. The second thing that I want to understand is in our payments business, the GTV ex of UPI is still north of 30%, is the growth that we have seen for last many quarters.

Obviously, the revenue hasn't been growing, but obviously the profitability has been improving. Except for UPI, in the remaining business, are we seeing some sort of mix change into certain products which are sort of less in revenue, higher in margins?

Because if the GTV ex of UPI is still growing north of 30%, and the revenue is not growing, but the profitability is growing, that means there should be something more than UPI that is driving this sort of change in the product mix in the payment business.

See, basically what is not currently broken down fully and it is shown in some places is basically we have started making some revenue in the UPI business also in some parts on the consumer side. Even though the PPI over UPI MDR has not come, once that comes, it will completely add on to that.

Even on the bank UPI side, the 170% growth that happened over the last 1 year has started generating revenue in small amounts in different pockets. As it scales, that will directly flow into the bottom line of the company.

The other segment which is showing a lot of promise is bill payments. In bill payments, like Upasana mentioned, we've already reached a decent scale in terms of Bharat BillPay.

There, the revenue contribution is also picking up. We expect that in 12 months' time, both of these, both UPI as well as bill payments, will be contributing significant amount to the growth of the revenue of consumer payments, beyond what you see today.

I get that, but what I'm trying to understand is if the last 3-4 quarters we are seeing ex of UPI GTV growth being north of 30%, ideally it should start reflecting in revenue growth, right, in the payments business? That divergence is something that I'm not able to understand, because obviously the total GTV growth is much stronger because of UPI, and assuming that UPI doesn't make any revenue, but even excluding that, revenue being flat and ex of UPI GTV growth being north of 30%, so that is not adding up, honestly.

No, look, there is been obviously moderation of the take rates in some of the existing business also that we have seen, because of which you see the overall payments business, gross take rate has come down. At the net level, we are still making money, but at the gross level, there is a mix change that has happened thanks to UPI, thanks to addition of some categories which don't make as much money as possible.

That's what I can tell you today. Because of that, you see that the revenue growth in the non-UPI part is also not as much as we would have expected in the past.

In fact, okay, lastly, just any sense of what kind of fixed cost we can expect going ahead? Rough sense would help.

Hello?

Hi, I'll just take this question. This is Soham from MobiKwik.

Fixed cost, right now we are on the ₹115 to ₹120 crore per quarter range. Now as the merchant business keeps growing, obviously there will be increases in depreciation as well as we will also increase the people cost for further distribution of those devices.

You can roughly assume a 15% to 20% increase in fixed cost in the next year.

Got it. That was helpful.

Thanks.

Hi. Basically, on the NBFC side, from when can we start our own lending, and how will we arrange for the funds for that particular lending?

Hi Smit, this is Upasana. On the NBFC side, as we have detailed out in the earnings slides also, currently the dictat from the regulator is that we have to first move our existing digital lending LSP business to a wholly owned subsidiary of MobiKwik, which we intend to finish in the next 2 to 3 months.

Post which, we will start the NBFC setup work, which we expect that if I count from today, then at least 3 to 6 months is the time frame in which the NBFC will be set up. After that, in the 6 to 9 months time frame is when I expect that we will launch the operations and start disbursements in the co-lending model.

This is sort of the high-level guidance that I can give. These are the steps that I just mentioned.

First, we have to move our existing business from the parent to a wholly owned subsidiary, and only then we can start the NBFC operations in yet another wholly owned subsidiary. With regard to the capital allocation, because it's a wholly owned new subsidiary of MobiKwik, we will be shortly going through the board and shareholder approval process to infuse funds into this entity.

Understood. Our digital credit GMV growth on a sequential basis has been subdued this quarter.

What are the reasons for the same? Because on this base, driving high single-digit or 10% kind of sequential growth wouldn't be too difficult.

What were the reasons for the subdued growth?

Smit, the high-level answer to that is that we are prioritizing quality and profitability over volume. Like I mentioned, we have increased our loans to repeat customers from about 20% to 63%.

We have also increased our loans to the super-prime users, which used to be 10% of the disbursement to now 32%. We are moving a lot of our lending focus towards prime and super-prime customers.

Of course, we have about 20% near-prime customers also. Therefore, the larger point I want to make is that the portfolio is tilting towards repeat and super-prime cohorts.

We will be continuing to grow in this manner where the focus is more on higher-quality book resulting in higher net margins instead of just focusing on higher disbursements.

Understood. FY26 digital credit GMV stands at roughly around ₹3,200-odd crores.

What should be the growth rate in FY27?

I think broadly 30%-35% is what you can assume.

Okay. Can you guide on a broad EBITDA margin range for FY27?

Similar to the 5% range that we are at.

Understood, understood. Thank you so much.

That's it from my side.

Just to clarify, Smit, we are saying that we will make better margins, but we will be making more investments, and therefore the net EBITDA margin that will be reported will be in the same broad range of 5% where we are.

Hello, am I audible?

Yeah. Congratulations on a great set of numbers.

Actually, I had the same question, and I was not able to get the answer. Why are we not using our cash and using the short-term facilities for the loan to meet our working capital requirements?

I missed the answer.

Hi, I'll take that answer. Effectively what we are saying is out of the total unencumbered cash, a significant portion of it is still part of our IPO proceeds, which we do not have access to yet.

The IPO proceeds keep trickling in as and when they are used. Secondly, the working capital is required more so to fund during the weekends when 2 to 3 days we do not get the funds from the banks, but we have to make the payments to the merchants and our customers.

In those days, the usage is more, which typically tends to be higher than our remaining cash. Hence, our working capital requirement there helps us to maintain the balances.

Nevertheless, we have tried to ensure that we keep this working capital under check. If you see our payments GMV has exploded, it has grown multifold, but our working capital has remained stable over this period.

Actually, it has come down. From Q3, ₹7.2 crore, in Q4 it has come down to ₹5 crore in terms of finance cost.

Got it. Thanks, and all the best for the future.

Good evening, ma'am. Congratulations on the strong set of numbers.

Ma'am, I had two questions. First, for FY27 and '28, what is the revenue growth trajectory that we anticipate for our payments business as well as lending business?

Another question around the sustainability of our margins. Our lending spreads are at 5.4%.

Is that sustainable? I think we had guided that 4% to 4.5% was a sweet spot for us.

Around that, if some guidance.

Hi Shlok. Thanks for asking the question.

We do expect that our GMV growth will be in the range of 30% to 35% in both of our businesses, payments and lending. In terms of the lending margin, we have shown that the performance of the cohorts is coming stronger, where 35% lower credit cost is coming on the maturing portfolio.

We also have some previously matured cohorts from which we are getting gains due to superb collection effort. Given all of these, we have landed at the 5%, 5.3% margin.

From a long-term perspective, we are not guiding 5%. We are comfortable with the 4% range.

We do believe that that is the sweet spot. I think that we have done well and we have collected deferred revenue also from previously maturing portfolios.

I'm not sure whether we can commit long term that we'll be able to deliver these margins. I think 4.5% still sounds more sustainable.

Ma'am. Ma'am, just around payments margin, is this 16 basis points workable number for next 2 to 3 years?

From my perspective, I would love to say that, but of course it's not in my control. As you know that India is a very healthily regulated market, and we have various licenses also in payments business, the various regulatory changes can impact that, which is why from a mid to long-term perspective, we are guiding 12 to 15 basis points, even though every quarter so far we have been doing better than that.

I don't think from a 2-year time frame I would recommend modeling for 16 basis points, because we really can't tell if and when any regulatory change could change that. Therefore, we always recommend a more conservative approach.

Ma'am. Okay.

Thank you, and all the best for the next quarter.

This merchant partners currently are 4.9 million. Where do you see the merchant partner number going in FY28?

This year we grew at a mere 7%, now we are going to aggressively onboard a lot of merchants. Where do you see this number in FY28?

We are not obsessing about the number of merchants. I think what we are looking at is we have looked at our offline merchant partners in terms of different categories, especially three different categories.

One is the organized retail, second is petrol, and third is small mom-and-pop stores. Our aim is that we get to maybe between 10% to 20% of the market leader's size in the next 18 to 24 months, or perhaps before that.

With that view, we are investing and building in this business.

Understood. That's it from my side.

Thank you so much, and all the best.

Hi. Thanks for the opportunity.

Basically, I want to understand on your strategy on the merchant acquisition side. We have this goal of increasing our Zaakpay revenue meaningfully and also on the offline side of it.

If you could explain what kind of investment that could entail, what could be the easy picking relatively for us to have that kind of a growth potential. Is it more like reviving the same customer, or it's led by more customer acquisition?

Any color on those factors would help. Thank you.

Thanks, Rahul, for the great question. What we are doing is, both the merchant side, both on the online and as well as offline side, obviously the the businesses have become very, very big in the market, I mean.

What we are looking at is identifying specific categories within which we will try to gain a meaningful share of the market. For example, in the offline space, our business is divided into three categories: one is small mom-and-pop stores, second is oil and gas, and third is organized, which is basically, mid-market and above.

We're not necessarily focusing too much on enterprise. In at least two out of the three categories, we are focusing and identified that combined with the better product experience, end-to-end, and great service, we can get to 10% to 20% market share, or at least 10% to 20% of the market leader's size in the 18 to 24-month mark.

With that aim, we are investing in this business. On the online piece, Zaakpay, again, where we have identified few categories.

We have identified, for example, education as a as a great category; we have identified, government as a as a great category. Some of these categories are really, really very big, and even a double-digit share, percentage share in these markets will easily help us reach the goals of 10x that we are targeting for the next 18 months.

BBPS is another category, the Bharat Bill Payment System, where our PA, on the online PA, Zaakpay is going to be particularly relevant, is a category that we are scaling very rapidly. Because our scale is less right now, for us to get to 10x in the next 18 to 24 months looks doable by just identifying the right categories and investing and going deep into it.

Sure. One question on the lending side of the business.

Since now we have this NBFC route also to tap into this opportunity, is there a change in strategy on the LSP side of the business, or that remain as is and this could be an incremental thing? Is there any kind of a conflict of interest that we need to identify on the user acquisition side, or we just become one of the another lending partner and rest everything look same from an LSP point of view?

Look, from an regulator point of view, you have to ring-fence the businesses. Therefore, as NBFC has been received in one of the subsidiaries, and the LSP business is being migrated to another subsidiary.

The Holdco, which is One MobiKwik, will not have any LSP business or will not have any NBFC business. These businesses will sit separately in two subsidiaries.

They will all have basically agreements with each other on how the sourcing of customers is there, or how the billing of customers and revenue happens. This is all how it will be set up.

As far as the NBFC is concerned, look, LSP is still lightly regulated, but NBFC, the regulator expects proper governance, proper compliance, especially as you become bigger. Therefore, we expect that these companies, with their management, will be operating independently in their interest and in the interest of the Holdco, which is One MobiKwik, with their own individual managements.

I hope that answers your question.

This last piece which you didn't answer, Bipin, is that, Rahul, we expect that the LSP will continue in the similar fashion in the wholly owned subsidiary, and the business generated from the NBFC will be incremental to the business that we are already doing as an LSP.

NBFC will be one of the partners for the LSP. It doesn't mean that other lending partners will obviously go away.

Sure, sure. Just one further product into the point you raised, Bipin, that since both of the business would work in their own interest, the customer acquisition side of the NBFC, will completely rely on the app or they might find business opportunity outside the One MobiKwik app ecosystem?

This level of detail we haven't figured out, but we have to expect that NBFC will be built as its own independent company which initially, obviously, will work with MobiKwik. Eventually, if it follows its own independent trajectory, will be able to work in the market openly.

Sure. Thanks for the color, and best wishes for so many new things that you are working upon.

Thank you.

Thank you.

Thanks for the opportunity again. Just two quick clarifications.

On the merchant segment, when you sort of give a sense that you would be investing say ₹50-₹60 crores or whatever that amount would be, is this just the opex, or it also includes the capital investments in the devices?

This is just the opex we are talking about.

Okay. Secondly, on the lending business, in the medium to long run, what would be the say targeted split between the NBFC piece and the pure distribution sort of mix in terms of GTV?

I think it is too soon to say right now. We have to first set it up and launch it.

Maybe in a couple of quarters, you can ask this question.

Right. Because the sense is that since you have taken this big decision of starting an NBFC, you would have some idea, because if it's going to be just 10%, 20%, then ideally the kind of investment and the infrastructure that is needed, compliance that is needed for an NBFC might not really make that much sense.

Just was trying to get a sense that you might have some bigger plans to go ahead with this.

We may have, but I think it is too soon to reveal. First we want to reveal that we have completed the setup, then we will talk about how we will deploy it to grow the company overall.

Got it. Thank you.

That is helpful.

I had a follow-up on the previous question. We wanted to understand what are the target unit economics for the merchant business side.

Also, how are we tracking the efficiencies of our investments in the merchant business till now? Are there any signs of early wins, as we've already invested about ₹50 crores in that?

I think that this is the first quarter where we have actually broken down and given some level of detail in terms of the various sub-categories within payments, whether it is bill payments, whether it is merchant payments, etc. I think in the coming quarters, we will be revealing more.

Needless to say, we have revealed it as a growth engine, you should be assured that the management is looking at it with a hawk eye. We would also like to mention that the investments that we have already made are panning out in terms of certain growth KPIs, and we will start disclosing them in the rightful manner in the upcoming quarters.

One should be clear that especially on merchant payments also, transactions don't generate MDR. It is the credit on UPI rails or the RuPay credit card transactions that generate the MDR, and then there is a device rentals.

Then after there is a strong merchant engagement, then one can build the merchant credit pipe also. That is the long-term build-out of the economics from a merchant business perspective.

Fair enough, ma'am. Looking forward to the next quarter.

Thank you.

Thank you so much.

Thank you so much for hosting us, Rahul and the Dolat Capital team, and thank you to all the participants who actively engage with us in understanding how MobiKwik is building the future of fintech in India. Thank you.

Have a good evening.