Jupiter, a neobanking start-up based in Bengaluru, India, has been granted a non-banking finance company (NBFC) license by the Reserve Bank of India (RBI). The move will allow the firm to offer credit directly to customers and builds on Jupiter's existing lending operations through partner NBFCs.
The firm, which has raised more than $160 million in equity funding and was last valued at more than $700 million, intends to use Rs 100 crore ($13.3 million) in capital to fund the NBFC's credit operations and aims to hit annual disbursements of Rs 600-700 crore ($80 million-$93 million) in short- and medium-term personal loans. The NBFC will operate under Amica Finance, a separate entity.
The granting of the license follows regulatory changes in India's digital lending sector, according to Jupiter founder Jitendra Gupta.
The company, which has an existing customer base of more than two million, aims to operate at scale to drive business growth. Gupta expects the NBFC to help increase margins and contribute to the firm's overall revenue stream. Jupiter's lending operations are expected to focus on loans ranging from three to 24 months, with higher ticket sizes of Rs 75,000 to Rs 1 lakh ($1,000-$1,330).
Jupiter started as a neobank and has since been building a credit product. Its first credit offering, Bullet, was built on UPI rails but was discontinued in 2021. The company relaunched its lending operations in partnership with Trillionloans Fintech, which operates the peer-to-peer lending platform Liquiloans. Since the relaunch, Jupiter has built a loan book of more than Rs 100 crore ($13 million) in earned wage access (EWA) offerings and personal loans to users.
Now, with a direct NBFC play, Jupiter has added a second revenue line beyond investments and mutual funds distribution. The company brings in customers through new deposit openings and salary accounts in partnership with Federal Bank. Gupta expects "solid revenue" to come in by the fiscal year 2024 (FY24) as new revenue lines pick up. Jupiter also plans to launch UPI on credit through partners, as the service is only currently available to banks.