Backed by American giant Walmart, PhonePe Plans a consumer lending launch by January 2024 and initiates Partnerships with Multiple Lenders for Personal loan distribution. 

The digital payment platform is gearing up to introduce consumer lending services on its platform by January 2024, according to sources familiar with the matter told The Economic Times.  

As per the report, Initially, the company will function as a distributor for personal loans, gradually establishing its credit underwriting capabilities. In the final stages of integration, PhonePe is collaborating with a mix of banks and non-banking finance companies (NBFCs), with plans to unveil multiple consumer credit products in the next six to seven months. 

The fintech platform has a registered user base of 500 million customers and 37 million merchants. The lending offerings will be introduced gradually to consumers, people aware of the matter said.  

In a related development reported on November 21, PhonePe is also in the advanced stages of partnering with Axis Bank to distribute the bank's credit card offerings. 

While the final underwriting responsibility rests with the regulated entity, fintechs prioritise delivering to a customer base with a high approval rate and robust portfolio potential for effective distribution partnerships, the report added.  

Presently, PhonePe collaborates with partners such as Acko to distribute life, health, motor, and car insurance, facilitating monthly subscription payments through UPI. The platform has successfully sold 5.6 million policies as of July. 

PhonePe ventured into merchant lending earlier this year, extending loans of up to Rs 5 lakh to its merchant users. Recently, Hemant Gala was appointed as the CEO of its credit business, aligning with the fintech's strategy to create a group structure with distinct business lines, each contributing to their own revenue and profits. This move aligns with PhonePe's broader goal of a potential public listing in India.