The company has been earnings before interest, taxes, depreciation, and amortization (Ebitda) positive since the December quarter.
For the quarter ended September 30, Paisabazaar reported total revenue of Rs 154 crore, a 15% rise sequentially. Currently, Paisabazaar contributes to a little over 25% of PB Fintech’s core quarterly revenues.
Apart from Paisabazaar, the Policybazaar insurance marketplace also contributes to PB Fintech’s core revenues.
Also read | PB Fintech sees net loss drop to Rs 21.1 crore
For the second quarter, Paisabazaar reached an annual loan disbursal rate of Rs 16,600 crore. The credit products distributor disbursed loans worth Rs 4,129 crore on its platform for the three-month period, recording 17% sequential growth on the back of festive demand for credit.
Paisabazaar also improved its Ebitda-to-revenue ratio slightly over 6-7% from the previous quarter. The PB Fintech subsidiary, which is also a credit score provider, is eyeing 15% Ebitda by FY25 and 20% in the next two to three fiscal years, Kukreja added.
“We will look to grow two- to three-fold over industry growth, with our focus on co-created products and distribution. This essentially translates to 45-50% annual growth, which puts us in a healthy place. What will get us there is digitisation, helping us reduce leakages and increase our margins (aided by co-created products),” Kukreja told ET.
In terms of the revenue split, almost 45% of the platform’s overall revenues comes from unsecured personal loans, followed by credit card issuances at 25%. Distribution of SME loans contributes 18%, with the rest coming from secured credit offerings and allied services such as insurance cross-selling.
In the recently ended quarter, Paisabazaar saw almost 75% of the credit card distribution on its platform done through end-to-end digital processes. This number was 50% for personal loans, Kukreja said.
Now, the focus will be to ensure that almost 95% of disbursals of the platform across loans and credit card products are end-to-end digital over the next two to three years, said the CEO.
“We think that we are moving in the right direction annually with respect to our digital distribution strategy. We expect almost 75% of personal loans distribution on the platform to be end-to-end digital next year, with that number higher for credit cards, as more and more banks digitise themselves,” added Kukreja.
The company will also continue to focus on building its trail revenue from personal, unsecured loan and credit card products.
In simple terms, instead of taking an upfront commission to acquire the customer, Paisabazaar takes a fraction of the fee up front and is given a certain share of the loan or credit card interest (as commission), which constitutes its trail income.
Paisabazaar accrues this revenue over the lifetime of the product.
The company kicked off this strategy 24 months back to shield itself from black swan events such as covid.
Trail revenue contributed almost 14% of Paisabazaar’s quarterly revenues, unchanged from the previous quarter.
The company is looking to take this figure to 17% revenue contribution by FY24 end.
“We want to ensure that trail income contributes to 20% of our overall revenues by FY25. We are looking to launch two new co-created products starting Q4, which will help us build trail income further,” said Kukreja.