India’s fintech sector has never been more vibrant, or more competitive. While front-runners like Paytm, PhonePe, Razorpay, and now even Jio Financial Services with its BlackRock JV are consolidating power through massive user bases, deep distribution, and diversified product stacks, companies like MobiKwik find themselves in a difficult and sticky position.

In the first quarter of FY26, MobiKwik posted revenue of INR 281.6 Cr, down 18.6% YoY but up 3.7% from the previous quarter. Losses widened to INR 41.9 Cr from INR 6.6 Cr a year earlier. If the company was in a difficult position before, it’s become even more entrenched in its problems.

“One thing you have to understand is that we’ve been saying repeatedly over the last three quarters that FY25 was, in many ways, the best-positioned year for us,” MobiKwik cofounder and COO Upasana Taku told Inc42.

“But around August, the sentiment towards unsecured lending in India changed sharply, which led to a downturn in the credit distribution system in Q3 and Q4. Now, given that we’ve moved past that politically charged period, it doesn’t make much sense to compare our Q1 FY26 performance on a year-on-year basis, because all the numbers would naturally look worse,” she added.

Taku was referring to the RBI regulations on peer-to-peer (P2P) lending, forcing companies like MobiKwik to shut down or restructure their products like Xtra. MobiKwik also shut down its offering like Zip, which led to a sharp decline in lending revenue and user activity, despite the company’s public statements downplaying the impact.

The COO said that in Q4FY25, the company’s EBITDA was negative INR 45 Cr. By Q1FY26, that number was down to negative INR 31 Cr.

“That’s a INR 15 Cr swing we achieved through very deliberate measures,” she explained. “If we repeat that reduction in Q2 and Q3, we’ll break even by Q2. Even if we fall slightly short, say, INR 10 to INR 12 Cr in savings per quarter, we still expect to turn EBITDA-positive by Q4.”

While far stretched, the optimism is not unfounded. MobiKwik posted its highest-ever quarterly payments GMV at INR 38,388 Cr and recorded improvement in gross margins across verticals.

Taku’s hopes for profitability are based on Mobikwik’s payment business, which she says has the highest contribution margin of 28%, compared to other payments companies in India. It is pertinent to note that Paytm had reported a contribution margin of 60% in the same period.

According to her, for every INR 100 spent by a user, Mobikwik........

© Inc42