PhonePe FY24 operating revenue up 74% to Rs 5,064 crore, loss down 29%

Walmart-backed PhonePe narrowed its net loss by 29% in the last financial year to Rs 1,996 crore from Rs 2,795 crore in FY23. The improved financial performance was backed by a 74% growth in operating revenue to Rs 5,064 crore in FY24, from Rs 2,914 crore a year before, according to the company’s latest annual report.

PhonePe said it posted an adjusted net profit of Rs 197 crore in the last financial year, excluding costs towards employee stock ownership plans (ESOPs), highlighting that its core operational business has started to turn profitable.

Total expenses at the digital payments firm rose 31% to Rs 7,756 crore in FY24. This was largely due to a 16% increase in employee expenses at Rs 3,603 crore.


Payment processing charges—the cost payment firms have to bear for settling digital transactions with banks—surged 75% to Rs 1,166 crore last fiscal.

PhonePe tightened its balance sheet regarding cashback and incentive-based expenses by spending only Rs 15 crore in payment incentives in FY24. In FY19, at the peak of the cashback battle between Paytm, Google Pay and PhonePe, the Bengaluru-headquartered startup had spent Rs 950 crore, it said.

According to the firm, multiple factors such as diversification of revenue streams through distribution of mutual funds, ecommerce, credit and other measures helped the company stabilise revenues and report strong growth.

PhonePe is also building revenue channels tapping its more than 40 million merchant base by selling sound boxes and point of sales machines. It currently earns 10% of its overall revenue from MDR-related incentives provided by the government, the company said.

MDR, or merchant discount rate, is the cost merchants pay to payment processors in lieu of digital payment services.

PhonePe trimmed its customer service team to around 400 agents from more than 1,100 five years ago. It has also automated 90% of customer queries, helping reduce overhead expenses.

“Our goal is to build internet platforms that empower Indian citizens to improve their lives and achieve their aspirations. Free market competition, driven by product innovation and service excellence, is the future. Transparency is central to this, which is why we are proud to release our first annual report,” said Sameer Nigam, chief executive at PhonePe.