Instamojo Records Flat Operational Revenue of Rs 46 Crore in FY23 Amid Core Payment Business Closure

In a strategic shift from its roots as a fintech startup, Instamojo, backed by Mastercard and Times Internet, has successfully transitioned into a Direct-to-Consumer (D2C) tech platform.

Despite refraining from adding any additional revenue or income in the last 12 months, the company managed to achieve profitability by focusing on cost reduction. The platform, which recently closed its core payment business, faced setbacks when the Reserve Bank of India rejected its license application. Instamojo, founded a decade ago, now specializes in offering digital tools to Small and Medium-sized Businesses (SMBs) and D2C enterprises to establish online stores.

Since the pivot, Instamojo has reported consistent month-on-month profitability, diverging from its previous reliance on standalone payment gateway revenue. However, annual filings indicate no increase in revenue or income over the past year. Despite this, the company achieved a significant turnaround, shifting from a loss of Rs 1.1 crore in the previous year to a profit of Rs 8.26 crore in FY23. The revenue from operations remained steady at Rs 46.2 crore, with Rs 7 crore generated from IT services and Rs 38 crore from a revenue account whose details remain undisclosed.

In terms of expenses, Instamojo displayed prudent financial management by reducing total expenses from Rs 48 crore to Rs 38.12 crore. The company achieved this through a reduction in employee benefit expenses, including salaries and provident funds, which decreased by Rs 4 crore to Rs 14 crore. Other expenses, such as marketing, promotions, managerial remuneration, insurance, and legal fees, also saw a decline from Rs 28.6 crore to Rs 23.14 crore.

Following the closure of its core payment business, Instamojo now provides payment solutions through strategic partnerships, transitioning clients' payment accounts to licensed partners. The Chief Operating Officer, Akash Gehani, confirmed the continued functionality of Instamojo's gateway business and hinted at ongoing talks with potential partners. Despite recent reports suggesting the platform's search for fresh funding, its ability to generate ample interest remains uncertain.