Razorpay, a fintech unicorn, has reported a 75% increase in total revenue for the fiscal year 2022, reaching INR 1,485.7 crore from INR 844.6 crore in the previous fiscal year. Although the company achieved a profit of INR 7.3 crore, an 18% increase compared to the previous year, on a standalone basis in FY22, it is yet to post profits on a consolidated basis. Razorpay’s revenue is primarily generated from payment gateway commissions, followed by software development and maintenance services and marketing services.
The fintech company recorded a total expense of INR 1,476.4 crore in FY22, a 76% increase from the previous fiscal year’s INR 838.94 crore. In FY22, Razorpay spent INR 31 crore on advertising promotion, while INR 54 crore went towards marketing expenses. Last year, Razorpay focused on scaling its product and made seven acquisitions, four of which took place in FY22 alone, including Curlec, a Malaysian-based recurring payments firm; Izealiant, a Pune-based banking technology company; Ezetap, a POS payments solution provider; and PoshVine, a loyalty and rewards management company.
Razorpay’s newly-introduced lending and neo-banking businesses, Razorpay Capital and Razorpay X, make up for under 10% of its revenue and are currently incurring losses. The founding members of the business revealed to Forbes that the lending & neo-banking divisions are suffering losses, whilst the payment gateway segment is yielding revenue. In December 2021, Razorpay was valued at a staggering $7.5 billion in its latest funding round, and the list of investors backing it included giants such as Tiger Global, Sequoia Capital India, GIC, Lone Pine Capital, Alkeon Capital & TCV.
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RBI has granted an in-principle approval to Razorpay and 31 other entities for payment aggregator licenses. However, the fintech has been barred from onboarding new merchants, which may have an impact on its FY23 results. The company is currently focusing on strengthening its banking platform, Razorpay X, by adding digital lending solutions for NBFCs and fintechs, as well as forex services for startups.
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