Fintech firm MobiKwik's loss jump 6X to Rs 42 crore in Q1 FY26

Fintech platform MobiKwik has reported a sharp year-on-year increase in its net loss for the first quarter of fiscal year 2026, as headwinds in its lending business continued to weigh on overall performance.

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The Gurugram-based company posted a consolidated net loss of Rs 41.9 crore in Q1 FY26, a nearly sixfold rise from Rs 6.6 crore a year earlier. The loss narrowed from the Rs 56 crore deficit recorded in the previous quarter.

Total income declined 18.6% year-on-year to Rs 281.6 crore, primarily driven by a steep fall in financial services revenue and a surge in financial guarantee costs linked to its lending model. Revenue from operations fell 20.7% to Rs 271.4 crore, while EBITDA slipped into the red at Rs 31.2 crore, compared to a profit of Rs 2.2 crore in Q1 FY25. On a sequential basis, the EBITDA loss improved from Rs 45.8 crore.

The sharp deterioration in profitability was largely attributed to a contraction in MobiKwik’s digital credit business. Revenue from financial services plummeted 65.8% to Rs 58.3 crore, from Rs 170.7 crore in the corresponding quarter last year. The company cited muted lender appetite and a strategic pivot away from short-tenure ZIP credit products as key reasons for the downturn.

Instead, MobiKwik is now banking on longer-tenure ZIP EMI loans under the Default Loss Guarantee (DLG) model, where it bears part of the credit risk to entice lending partners. While this model front-loads guarantee costs—Rs 21.4 crore in Q1, up from Rs 2.5 crore a year ago—revenue is deferred over the duration of the loan, compressing margins in the near term.

“We have discontinued the smaller-ticket ZIP product due to macroeconomic challenges,” the company said. “We expect operating performance to return to previous levels, approximately 40% gross margin in lending, by H2 FY26.”

Despite the lending drag, the payments segment remained a bright spot, contributing 76% of total income, up from 50% a year earlier. Revenue from the segment climbed 24.2% year-on-year to Rs 213.1 crore, while gross payment margins expanded to a record 28%, buoyed by improved cost efficiencies and higher throughput. Payments GMV (gross merchandise value) surged 53% YoY to Rs 38,388 crore.

MobiKwik also reported user and merchant base growth, ending the quarter with 18 crore registered users and 46.4 lakh merchants. Net payments margin held steady at 15 basis points.

Operationally, total expenses declined 9% YoY to Rs 312.8 crore, aided by cost optimizations in user incentives and payment gateway charges. Lending-related operational expenses fell to Rs 29.2 crore, from Rs 92.4 crore a year ago.

The company also continued to diversify its offerings. It secured regulatory approvals to operate as a stockbroker and clearing member via a wholly owned subsidiary and launched a new fixed deposit-backed RuPay credit card. Additionally, it is piloting a PIN-less UPI product, “Pocket UPI,” targeting underbanked users in smaller cities.