Payment services provider PayU India has achieved profitability in the September quarter, reporting a positive adjusted Ebitda of $3 million, a significant turnaround from a loss of $6 million in the same period last year. This robust performance is largely attributed to the remarkable growth of its merchant-lending business. The Prosus-backed company also saw its Ebitda margin climb by 400 basis points to 1% during the quarter. Furthermore, PayU's revenue for the September quarter reached $214 million, marking a 21% increase year-on-year and a 17% rise sequentially.

These positive financial results were disclosed in Dutch investor Prosus’ half-yearly (H1FY26) update. A key driver behind PayU’s improved financials is its merchant lending arm, which witnessed an impressive surge in assets under management (AUM), growing from $25 million in April 2024 to $204 million by September 2025. This growth stems from its strategic provision of working-capital loans to merchants on platforms like Swiggy and Meesho. Prosus also emphasizes PayU’s pivotal role as the payment gateway “connector” across its extensive India portfolio, which includes prominent names such as Swiggy, Meesho, PharmEasy, Rapido, and ixigo. The deepening links between these businesses are designed to enhance usage and foster overall growth within the ecosystem.

For the half year ended September 2025 (H1FY26), PayU India’s consolidated revenue increased by 20% year-on-year to $397 million, solidifying India's position as a primary growth engine within Prosus’s global e-commerce portfolio. Breaking down this figure, the payments business contributed $301 million, also up 20%, while the credit business added $96 million, representing a 17% increase compared to the previous year. At the broader India ecosystem level, Prosus reported a total revenue of $397 million in H1FY26, up from $332 million in the corresponding period a year earlier, indicating a consistent 20% growth for the segment.

Drilling down into profitability for H1FY26, PayU India’s payments business delivered an adjusted Ebitda of $2 million, converting a prior year's loss into profit. Concurrently, the credit arm significantly narrowed its adjusted Ebitda margin from –20% to –3%, successfully reaching breakeven in the September quarter. Prosus attributed this significant improvement to a strategic pivot towards higher-margin, value-added services (VAS) and software-as-a-service (SaaS) products. These offerings include crucial tools like fraud-risk management and multi-factor authentication, which are gaining considerable traction.

The investor further elaborated that these higher-margin services are becoming increasingly popular, with VAS and SaaS revenue now contributing a substantial 34% of the total payments revenue. This growth is particularly strong within the mid-market and small and medium-sized business (SMB) segments. Moreover, PayU India experienced a remarkable 55% jump in payment volumes during the first half of FY26. This surge was predominantly fueled by an increase in smaller-ticket UPI payments, while take rates remained steady due to strategic portfolio adjustments aimed at higher-yield segments.

Beyond PayU, Prosus has continued to expand its footprint in the Indian market, acquiring minority stakes in Rapido and ixigo during 2025. The company also pointed to recent Initial Public Offerings (IPOs) of Bluestone and Urban Company as concrete evidence of the growing maturity within various parts of its extensive India portfolio. Prosus, through its parent company Naspers, initiated its backing of India’s consumer internet sector in 2005, with an early investment in travel portal Goibibo in 2007. Over the past two decades, Prosus has committed over $10 billion to the market, spanning payments via PayU, food delivery through Swiggy, social commerce with Meesho, health-tech via PharmEasy, bike-taxi services with Rapido, and travel through ixigo. On the payment gateway front, PayU India operates within a highly competitive market, contending with other major players such as Cashfree Payments, Razorpay, BillDesk, and Paytm.