PhonePe handles nearly half of India’s UPI transactions, but that dominance comes with a problem: moving money is a difficult business to make money from. The company processed about 10.9 billion UPI transactions in September, yet its FY26 revenue rose just 11.5% to ₹7,920 crore while losses widened to ₹2,792 crore. Not all those losses come from payments, but the larger problem remains. UPI gives PhonePe enormous reach without much income from each transaction.
Its latest move makes more sense in that light. PhonePe has renamed Indus Appstore as PhonePe Appstore and is adding gift cards, gaming credits and other digital products, including through a website. It wants a share of what people buy, not just the payment they make.
This business has been years in the making. PhonePe bought Indus OS in 2022 and launched the app store in 2024, offering developers zero platform commission and access to users in Indian languages. Deals with handset makers have since put it on more than 200 million devices. But being installed on a phone doesn't mean anyone opens it. Most Android users already go straight to Google Play.
The new marketplace could give them a reason to return. Someone buying gaming credits or a shopping voucher might come back every month. PhonePe could earn a margin on the sale or charge brands to promote offers. Gaming looks especially promising because purchases can be frequent. India already sees roughly 25 billion app downloads a year, and spending inside apps reached $345 million in the second quarter of 2026, up 35% from a year earlier.
Developers may also welcome another outlet. Google's fees can take a meaningful share of digital sales, while PhonePe promises zero platform commission. But developers are unlikely to abandon Google, which still brings them most of their Android audience. PhonePe has to prove it brings paying customers, not merely downloads.
The economics need watching, too. If 20 lakh customers spend ₹500 a month, that is ₹1,200 crore in annual sales. At an illustrative 3% margin, PhonePe retains only ₹36 crore before operating costs. Advertising may eventually matter more, bringing back the familiar problem of developers paying to be seen.
Three years from now, we doubt PhonePe will replace Google Play. It may, however, build a useful business in games, vouchers and subscriptions. PhonePe already knows how Indians pay. Now it must persuade them to shop there.
Let’s go through what else is happening in Indian startup world - Grab your simmering cup of StartupChai.in and unwind with our hand-brewed memes.
“Court Mein Milte Hain”: Bombay HC Lets Blink Digital's Suit Against Meta Proceed
The Bombay High Court has rejected Meta's jurisdiction challenge in a Rs 1,000 crore suit filed by digital agency Blink Digital.
The dispute concerns four disabled Business Manager accounts and roughly 9,000 linked advertising accounts.
Read more here
“Baat Abhi Pakki Nahin Hai”: Cognizant Reportedly Eyes Sarvam AI Investment
Cognizant is reportedly in talks to invest in Sarvam AI as part of a proposed $300 million round that could value the Indian AI startup at $3.5 billion to $4 billion.
Sarvam completed a $234 million first close in June at a reported $1.5 billion valuation, including a $150 million commitment from HCLTech.
Read more here
“Kuch Naya Ho Jaaye”: NIT Rourkela Team Develops Safer Light-Emitting Materials
Researchers from NIT Rourkela, IIT Guwahati, IIT Bombay and NISER Bhubaneswar have developed bismuth-based materials that emit different colours under ultraviolet light and respond reversibly to heat and moisture.
The lead-free compounds could support anti-counterfeit inks, humidity sensors and energy-efficient lighting.
Read more here
“Zor Laga Ke Haisha”: DPIIT Plans Procurement Push For Startups
The government is working on a framework that would use public procurement to create early demand for startup products.
The push matters because more than half of India's over 2.5 lakh recognised startups are based in Tier 3 cities and smaller locations.
Read more here
“AI Ki Shakti Dhoom Machaye”: SEBI Weighs Domestic Model For Securities Supervision
SEBI is exploring a domestically governed AI model for India's securities market while implementing IOSCO's global supervisory toolkit.
The proposal would treat AI as market-level digital public infrastructure rather than a closed vendor tool.
Read more here
“Taiyyari Jeet Ki”: PB Money Secures SEBI OBPP Registration
Investment platform PB Money has received a SEBI registration to operate as an Online Bond Platform Provider.
The platform plans to handle onboarding, KYC, discovery, order placement, payments and post-purchase servicing for bond investors.
Read more here
“Kuch Kar Dikhane Ka Junoon”: PhonePe Rebrands Indus And Adds Digital Goods
PhonePe has rebranded Indus Appstore as PhonePe Appstore and expanded it beyond app downloads into gift cards, gaming top-ups and other digital goods.
Indus is preloaded on more than 200 million devices through OEM partnerships.
Read more here
“Pyaar Ka Bandhan”: Freshworks Acquires Israeli Startup Robusta Dev
Freshworks has acquired Israel-based Robusta Dev for an undisclosed amount. Robusta's open-source technology monitors software projects and will be folded into Freshservice to strengthen incident management and IT operations.
The acquisition adds AI-led incident intelligence while preserving interoperability with tools such as FireHydrant.
Read more here
“Achha Chalta Hoon”: Info Edge Sells MedCords And Unnati Stakes
Info Edge will sell its entire 14.18% stake in MedCords and 31.64% stake in Unnati Online for about Rs 5,000 each. The shares are being transferred to the companies' respective promoters.
Both investments had already been fully impaired, MedCords in FY24 and Unnati in FY20.
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“Main Sambhaal Loonga”: Sanjeev Bikhchandani To Lead Info Edge As Hitesh Oberoi Steps Down
Hitesh Oberoi will step down as Info Edge's managing director and CEO on December 2 after nearly 27 years with the company.
Founder Sanjeev Bikhchandani is set to become executive vice chairman, managing director and group CEO from December 3, subject to shareholder approval.
Read more here
“Swagat Nahi Karoge Humara”: Bellatrix Aerospace Appoints Kiran U As CFO
Spacetech startup Bellatrix Aerospace has appointed Kiran U as chief financial officer. He will oversee financial strategy, capital efficiency, funding diversification and support for the company's international expansion.
Kiran brings 17 years of experience to the propulsion-technology company.
Read more here
“Tum Aage Badho, Hum Tumhare Sath Hain”: Ixigo Cofounder Launches Made In Fire Fund
Ixigo cofounder Rajnish Kumar has launched the Rs 1 crore Made in Fire Fund for student founders at IIT Kanpur.
Each batch will select ten startups for Rs 10 lakh in non-dilutive prototype funding and mentorship.
Read more here
“Sapne Dekhe Bade Bade”: Moms Home Builds Rs 10 Cr Channel
Jaipur-based baby essentials brand Moms Home grew quick-commerce revenue from Rs 1 crore in FY25 to Rs 10 crore in FY26, about 30% of its Rs 35 crore total revenue.
Its products are now available across 80 cities.
Read more here
“Koi Hero Yahan”: Bhubaneswar's BonV Aero Completes High-Altitude Trials
Bhubaneswar-based BonV Aero has completed high-altitude trials carrying a 32 kg payload at elevations between 10,500 and 16,500 feet.
The startup had earlier carried 30 kg at Umling La, 19,024 feet above sea level.
Read more here
“Taiyyari Jeet Ki”: Vashi Plans 22 Solar Marts Across Ten States
Vashi Integrated Solutions plans to open 22 solar marts across ten states during FY27. The stores will provide solar products alongside procurement and technical support for installers and customers in smaller cities.
Read more here
Bijnis has rebranded as Zorit and raised Rs 27 crore in a round led by Sparrow Capital, with Info Edge, WaterBridge Ventures, Better Capital, angels and employees participating.
Read more here
Let's Game Now has raised Rs 30 crore in a round co-led by Anand Mahindra and Bestvantage Investments, with participation from a UAE family office.
Read more here
QwikBuild has raised $2.3 million in pre-seed funding from Globalway, Blume Ventures, Marsshot Ventures, DeVC and angel investors.
Read more here
Spiritual-tech platform Vama is raising Rs 19.03 crore in an ongoing pre-Series A round led by Dainik Bhaskar family office Writers and Publishers, with Wavemaker, Silver Needle and angels participating.
Read more here
Skincare brand CHOSEN has extended its Series A round with an undisclosed investment from Wellbeing Nutrition founders Avnish Chhabria and Saurabh Kapoor.
Read more here
