BharatPe Posts Highest-Ever Gross Revenue Of $23.5 Mn In August

BharatPe, a well-known fintech startup, has recently grabbed news with its remarkable accomplishments and strategic endeavors in the constantly changing fintech market of India. The company’s market journey is compellingly depicted by its record-breaking revenue, innovative offers, and problems.

Credits: Inc42

BharatPe’s Record-Breaking Performance

BharatPe reached a noteworthy milestone in August 2023 when it recorded record gross sales of $23.5 million, or roughly INR 195 crore. This accomplishment demonstrates the company’s tenacity and expansion in the very competitive fintech industry. Moreover, the company’s stature as a fintech giant is strengthened by the outstanding monthly performance, which equates to an annually revenue rate of $282 million, or around INR 2,340 crore.

There are other reasons for the noteworthy increase in revenue. The loan division of BharatPe has performed better, which has been a major factor in its growth. This introduction was strategically timed in August 2023 to coincide with the wave of acceptance of digital payments, which increased BharatPe’s revenue even more.

Strategic Ventures and Expansions

BharatPe has not limited its growth to revenue generation. The company has strategically expanded its reach and diversified its offerings to stay ahead in the fintech race.

Small Finance Bank License: In October 2021, BharatPe, in collaboration with Centrum Financial Services Limited, secured a Small Finance Bank (SFB) license from the Reserve Bank of India (RBI). This strategic move allows the company to provide a broader range of banking services, enhancing its competitive edge in the fintech landscape.

Buy Now Pay Later (BNPL): The company ventured into the Buy Now Pay Later (BNPL) segment with the launch of “postpe” in October 2021. This initiative has seen substantial success with over 8 million downloads and an annualized total payment value (TPV) exceeding INR 5,000 crore. The BNPL space has been gaining prominence in the fintech sector, making this move strategically important.

Online Payment Aggregator Approval: In January 2023, the BharatPe Group received preliminary approval from the RBI to operate as an online payment aggregator. This recognition further solidifies the company’s position in facilitating digital payments and fintech services in India.

Strategic Acquisition: In May 2023, BharatPe made a significant move by acquiring a 51% stake in Trillion Loans, a non-banking financial company (NBFC) based in Mumbai. This acquisition aligns with BharatPe’s goal of expanding its financial services offerings and diversifying its portfolio.

Overcoming Challenges and Transitioning to Profitability

Despite its impressive revenue growth and strategic initiatives, BharatPe is not without its challenges. The company recorded a substantial loss in FY22, with total losses surging to INR 5,610.7 crore from INR 1,619.2 crore in FY21. A substantial portion of this increase was due to expenses related to the change in the fair value of compulsory convertible preference shares (CCPS).

Addressing these challenges is imperative for BharatPe’s path to profitability. Several key areas require attention:

Expense Management: High expenditure in areas such as advertising and promotions, along with employee benefits, has been a cause for concern. Reducing expenses is crucial for the company’s bottom line.

Leadership Stability: The company has faced a leadership crisis, with the resignation of the CEO, Suhail Sameer, and the departure of top-level executives. Stabilizing the leadership team is essential for driving the company forward.

Restructuring Credit Costs: To mitigate losses and non-performing assets (NPAs), BharatPe needs to reevaluate its credit processes and ensure that loans are distributed judiciously.

Marketing Expenses: Scaling back marketing expenditures while maintaining brand visibility is a delicate balancing act that the company must master.

BharatPe’s Journey and Impact on Fintech

From its founding to its current status as a fintech unicorn, BharatPe’s path has been characterized by innovation, calculated decisions, and difficulties. The foundation for the company’s explosive growth was laid in 2018 with the launch of India’s first UPI interoperable QR code and zero MDR payment acceptance service. Its services were further enhanced in 2020 with the introduction of the BharatSwipe card acceptance terminal.

BharatPe has made a name for itself in the fintech industry in India, handling over 300 million UPI transactions a month and catering to one crore merchants. Its significant impact on enabling digital payments is demonstrated by the annualized Transaction Processed Value of nearly $26 billion.