PhonePe IPO Relaunch After UPI MDR Fee Clarity
PhonePe Ltd is evaluating options to restart its initial public offering (IPO) process, two people familiar with the matter told Mint. The move follows the National Payments Corporation of India’s (NPCI) decision to allow a 0.4% merchant discount rate (MDR) on large UPI transactions from 15 October.
The new fee framework provides structural clarity on revenue and facilitates a path to public equity markets. A share sale is not likely anytime soon, but the sources said the notification provides clarity on transaction fee parameters.
PhonePe plans to submit updated financial metrics to Sebi before moving forward with a listing.
What PhonePe does
PhonePe derives 42% of its revenue from non-payment segments including merchant services, insurance, and lending.
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According to its January IPO filings, restated losses declined by more than ₹1,060 crore from FY23 to FY25 to ₹1,727 crore. Revenue from operations increased at a 56.25% compound annual growth rate (CAGR) to ₹7,115 crore over the same period, and the company turned adjusted-Ebitda-positive in FY24 and FY25.
Why it matters
The NPCI’s MDR framework gives payment platforms visibility into their revenue models and unit economics. MDR had been 0% for UPI and RuPay debit card transactions since 2020. The 0.4% fee applies to person-to-merchant transactions exceeding ₹2,000 and is capped at ₹300 per transaction.
The company had previously paused its IPO plans in March, citing global market volatility and geopolitical tensions. Before the pause, it had been targeting a valuation of $9 billion to $10.5 billion, according to a PTI report cited by Mint.
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