PayU swings to Ebitda profit in FY26 as payments, credit businesses rally

Bengaluru: Digital payments firm PayU India turned profitable on an Ebitda basis in FY26, reporting $19 million in Ebitda in the second half of the fiscal year as improvements in its payments and lending businesses lifted profitability, parent company Prosus said in an investor presentation accompanying its fiscal year 2026 (FY26) results. PayU’s Ebitda margin in the second half (H2) of FY26 stood at 5%.

PayU had reported an Ebitda of a negative $6 million in the second half of FY25 and a negative $19 million in the first half of FY25, the presentation showed.

The payments major reported revenue of $384 million in H2FY26, down 3.2% from $397 million in H1FY26, but up about 6% from $362 million in H2FY25.

Ebitda is short for earnings before interest, taxes, depreciation and amortization, and is measure of operating profit.

For the full year FY26, PayU India’s revenue rose 12.5% to $781 million from $694 million in FY25, the presentation showed. Full-year Ebitda stood at $18 million in FY26, compared with a negative $25 million in FY25, translating into an Ebitda margin of 2%.

Within this, the payments business, including the payment gateway unit, grew 10% to $577 million in FY26 from $523 million a year earlier. Payments Ebitda also improved to $12 million from $3 million in FY25. The credit business grew 19% to $204 million from $171 million, and turned profitable with Ebitda of $6 million in FY26, against a loss of $28 million in FY25.

Shunning lower-margin businesses

Prosus said PayU India’s improved profitability in FY26 was driven largely by a deliberate shift away from lower-margin businesses, even as it scaled faster-growing payment-processing volumes. In the payments segment, a fourfold jump in adjusted Ebitda to $12 million was supported by higher-margin value-added services (VAS) and software-as-a-service (SaaS) products, which accounted for 33% of payments revenue.

Prosus said PayU’s acquisition of Mindgate Solutions helped it build a proprietary third-party application provider stack and person-to-merchant switch, improving transaction success rates and paving the way for new UPI-based services for merchants.

PayU increased its stake in Mumbai-based Mindgate to 70% in September, becoming the majority shareholder. The transaction valued the company at about $300 million. In addition, PayU’s acquisition of Wibmo, completed in 2019, gave it a digital payments security and enablement platform that helps strengthen payment processing and transaction reliability.

Through Mindgate and Wibmo, Prosus said PayU helps Indian banks process one of every two UPI transactions and three of every four credit card transactions. The presentation also said PayU’s payments business scaled efficiently, with transactions up 49% and total payment volume (TPV) up 15% in FY26, while its move away from lower-value UPI-heavy segments such as quick commerce and bill payments helped reduce transaction costs.

In credit, PayU shifted to a partnership-led, digital-only ecosystem lending model, which improved unit economics and reduced the net loss rate to 4% from 5% in FY25.

PayU anchors India bets

Prosus said its India portfolio is increasingly connected through PayU, with the payments business embedded across many of its consumer internet bets, including Swiggy, Meesho and ixigo.

PayU reported significant growth across key Indian internet platforms. On Swiggy, its processed gross merchandise value (GMV) surged fivefold year-on-year as it captured a larger share of the food delivery platform’s payment volumes. On Meesho, PayU’s lending vertical doubled its loan originations within nine months by extending credit to both buyers and merchants. Meanwhile, on travel platform ixigo, PayU saw its processed UPI volumes jump 50% in a single month.