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Digital payments company Mobikwik has reported a consolidated net loss of Rs 3.59 crore for the second quarter of FY25, a reversal from the Rs 5.22 crore profit it recorded in Q2 FY24.

Mobikwik’s total income for Q2 FY25 rose 41.98% YoY to Rs 293.66 crore from Rs 206.83 crore in Q2 FY24. However, sequentially, income fell 15.08% from Rs 345.82 crore in Q1 FY25.

Mobikwik, in a statement, said it adopted a “prudent and selective approach” in distributing credit products during Q2 FY25 to align with prevailing macroeconomic conditions and mitigate risks.

The company reduced the scale of its small-ticket credit product ‘ZIP’ which provides instant credit for transactions.

ZIP GMV (gross merchandise value) disbursed declined by 35.4% quarter-on-quarter (QoQ) to Rs 950 crore in Q2 FY25.  ZIP EMI, a larger ticket size credit product, saw GMV decline by 22.9% QoQ to Rs 675.8 crore.  

The company said it emphasised quality over quantity in disbursements, prioritising risk-adjusted growth. This strategy impacted revenue from financial services, which was Rs 75.7 crore in Q2 FY25, a sharp decline from Rs 136.7 crore in Q2 FY24.

Payment gateway costs surged by a staggering 214.3% year-on-year to Rs 135.65 crore in Q2 FY25, up from Rs 43.16 crore in the same quarter last year. Employee benefits expenses also saw a significant increase of 72.49% YoY, reaching Rs 43.59 crore.

Total expenses for the quarter amounted to Rs 286.86 crore, a 46.34% rise from Rs 196.01 crore in Q2 FY24, but declined sequentially from Rs 343.59 crore in Q1 FY25.

After September 30, 2024, Mobikwik entered into a waiver agreement with a lending partner. Under this, the company decided to forgo Rs 24.21 crore in income from Q1 FY25, which was adjusted against the current quarter revenue. In return, the partner waived Rs 42.16 crore in facilitation fees, mainly related to Q1 FY25, reducing current quarter expenses.

Operationally, Mobikwik added 6 million new users, expanding its total base to 167 million, and onboarded 1.4 lakh new merchants, taking the merchant count to 44 lakh.

MobiKwik made a remarkable debut on the stock market on December 18, 2024, with its shares closing at Rs 530 apiece on the Bombay Stock Exchange, nearly double the IPO price of Rs 279. The stock surged 90.07% from its issue price and 19.91% from its debut price, reaching Rs 530.30 by the market close.

MobiKwik’s IPO, which was open for bidding from December 11 to 13, 2024, became the second-most subscribed new-age tech IPO in India, with the offering subscribed 119.38 times.