MobiKwik looks to break even this fiscal as payments GMV touches lifetime high in Q1 FY26

Fintech firm, MobiKwik Systems Ltd today reported strong momentum in its core payments and financial services business for Q1 FY26, with the company stating that it is on track to break even at the EBITDA level by the second half of the fiscal.

The fintech firm posted a 32% quarter-on-quarter growth in EBITDA and a 22% jump in contribution margin for the June quarter. Payments Gross Merchandise Value (GMV) hit a lifetime high of ₹384,000 crore, up 53% year-on-year, while gross margin in the payments business rose to 28%, compared to 16% in Q1 FY25. The company retained a net payments margin of 15 basis points, despite growing UPI volumes, reflecting continued cost optimisation.

“We've done exceptionally well in Q1 & Q2 last year on both payments and lending business. But subsequently in Q3 and Q4, the lending business had taken a huge beating because of the slowdown in the market itself. We are working hard towards recovering that and we are seeing recovery in quarter over quarter,” said Upasana Taku, chairperson, executive director and CFO of MobiKwik

In the current quarter, the company has reported a 30% plus improvement in EBITDA and overall EBITDA is negative ₹31 crores with a swing of ₹15 crore from Q4 to Q1.

“Mathematically, if we are able to achieve a similar swing of ₹15 crore, in about two quarters we should break even. On a conservative basis, if we are able to do ₹10 crore off-swing in the next few quarters, then also we should break even. We are quite confident that in this financial year, either in Q3 or Q4, we should be able to break even. And then work towards building a far more profitable growth engine in the next financial year,” she added.

Total income for the quarter stood at ₹774 crore, up 22% sequentially. The platform's registered user base grew to 180.2 million, while the merchant base reached 4.64 million.

The payments segment continues to be the mainstay, contributing over ₹3.83 lakh crore in GMV. When asked about monetisation challenges, especially with zero MDR on UPI, Komal Sharan, head - finance, corporate development & investor relations said, “At 15 basis points, the payments margin is probably among the highest in the industry. Going forward, wallet growth, scale-up of Zaakpay, and regulatory tailwinds like interchange on Pocket UPI could provide additional revenue upside.”

She added that the company had cut user incentives by 57% and reduced payment gateway costs by 27% sequentially, leading to the jump in gross margins in payments.

Lending turns a corner

The lending vertical, which had slumped in the second half of FY25 due to regulatory shifts, is now showing signs of revival. MobiKwik reported a 31% QoQ growth in EMI disbursals in Q1 FY26, touching ₹693 crore. Take rates improved to 8.3%, while gross margin in the lending business jumped to 13.3%, up from 4% a quarter ago. The company expects this to rise further.

“We believe the worst is behind us. Lending margins will reach 40% by H2 FY26 as the book seasons and accounting changes normalise,” Taku said.

MobiKwik runs two models in lending – a risk-sharing model involving a Default Loss Guarantee (DLG), and a pure distribution model with upfront fees. Most disbursals currently fall under the DLG model. On FLDG invocation levels, the company said it typically offers 3-5% guarantees across lending partners but indicated minimal invocation so far due to improving credit quality.

On unit economics, gross revenue in lending stands at 10-12% of disbursals (including processing fees and NIM), while total costs including credit, underwriting, and collections bring net margins down to 4-5%.

The fintech is also slowly scaling merchant lending through Merchant Cash Advance (MCA) but said it remains too nascent to disclose separately. “We are building out the infrastructure. It’s live, but still early days,” said Sharan.

Moreover, MobiKwik continues to push into adjacent financial services. After securing a full Payment Gateway licence for Zaakpay in Q4 FY25, it has now received a Stock Broking licence.

“These additions reflect our goal to become a single, trusted platform for all financial needs, from payments to credit to savings,” Taku said.

The company also reiterated its commitment to scaling its devices and offline merchant business, which has grown 7–8x over the last two years, backed by unutilised IPO proceeds earmarked for this segment.

Operating leverage in focus

Fixed costs remained flat at ₹108.6 crore for the fifth straight quarter, underscoring the company's focus on operational efficiency. “Despite the scale-up in users and merchants, we’re not expecting any significant pressure on fixed costs. The existing machinery is well-invested for growth,” said Sharan.

On the financing side, MobiKwik’s working capital debt fell from ₹46 crore in Q4 FY25 to ₹32 crore in Q1 FY26, even as finance costs remained steady. Cash on the books stood at ₹475 crore as of June 30, not including guarantee-linked fixed deposits.

For now, the company is betting on improving take rates, a lean cost structure, and a maturing lending portfolio to nudge it toward profitability.