Startup Deep Dive : BharatPe — the loss shrank from Rs 5,610 crore to Rs 88 crore after its founder’s ouster

In August 2021, Tiger Global led a $370 million round that valued BharatPe at $2.85 billion, turning a three-year-old QR-code startup into one of India’s most talked-about fintech unicorns. Seven months later, the company’s own board was accusing its most famous co-founder of siphoning off funds, and the accounting loss for that same year had swollen to ₹5,610 crore ($584 million) — driven mostly by a non-cash markdown, but a jaw-dropping number all the same.

By the year ended March 2025, the loss was down to ₹88.2 crore and the company said it had turned adjusted-profit positive, run by a chief executive who had spent a year as an interim placeholder before anyone made it official. BharatPe’s real story is not the soundbox beeping in ten million shops. It is what happened to the business once the man who built its reputation was removed from it.

Quick facts

What they do

BharatPe sells small and medium merchants — the kirana store, the roadside cart, the salon — a way to accept digital payments without paying a merchant discount rate, and then a way to borrow against the payments data that acceptance generates. The product line has grown from a single QR code into a stack: the BharatPe QR for UPI collections, the “soundbox” audio device that announces a payment out loud so a shopkeeper does not have to watch a screen, point-of-sale card machines, a payment gateway for online merchants, working-capital loans arranged through partner non-banking financial companies (NBFCs), and consumer credit through the BharatPe app (formerly branded PostPe). Since 2021 the company has also owned a minority stake in Unity Small Finance Bank, giving it a foothold in formal banking rather than only payments.

The origin

BharatPe was incorporated in March 2018 by Shashvat Nakrani, then a 19-year-old engineering student at IIT Delhi, and Bhavik Koladiya, with an initial capital of ₹1 lakh, according to company filings reported by BusinessToday in March 2022. Nakrani’s insight was narrow and specific: India’s new interoperable UPI QR codes meant a merchant no longer needed a separate machine for every payment app, so a single free QR code, backed by working-capital credit, could out-compete the paid POS terminals that banks and larger fintechs were renting to shopkeepers.

Ashneer Grover joined within weeks as co-founder and managing director, brought in by Nakrani and Koladiya through a transfer of shares rather than as a founding incorporator — a distinction that would matter later. Grover had spent about seven years at Kotak Investment Banking, then worked at American Express, and was chief financial officer at grocery-delivery startup Grofers before joining BharatPe, according to a profile by 5paisa’s Finschool. That finance and payments background, paired with Nakrani’s product instinct, shaped BharatPe’s earliest pitch: free acceptance to acquire merchants, credit to monetise them.

The struggle years

BharatPe’s setbacks were not gentle. In 2020, early in the pandemic, the company laid off around 40 employees for what it called performance reasons, months after publicising salary hikes, as reported by Business Insider India and BW Disrupt at the time. Merchant payment volumes had cratered along with the lockdowns, and the free-QR model — reliant on transaction float and lending eligibility, not fees — offered no cushion when transactions stopped.

The bigger blow was reputational and came in early 2022. In January that year, an audio clip alleged to be Grover verbally abusing a Kotak Mahindra Bank employee circulated publicly; he disputed its authenticity, but it triggered an internal board review. That review found what BharatPe’s board called financial irregularities, and in February 2022 the company terminated Madhuri Jain Grover — Ashneer Grover’s wife and BharatPe’s then-head of controls — citing inflated vendor payments, forged invoices and irregular expenses, per reporting compiled by legal-research site LexStart Partners and contemporaneous TechCrunch coverage. Grover resigned from the BharatPe board in early March 2022, a day after losing a Singapore arbitration he had filed against the company over the probe. On 9 May 2022, BharatPe publicly said it would claw back restricted shares from Grover and take action against employees implicated in the misconduct findings, alleging he and associates had “siphoned off” company money, per TechCrunch’s report that day. The dispute did not end there: in March 2023, co-founder Nakrani took Grover to the Delhi High Court, challenging the validity of the original 2018 share transfer that had made Grover a co-founder in the first place. The court sided with Grover, holding that an executed share-transfer form carried legal weight regardless of the oral dispute over payment. BharatPe separately filed a police complaint in May 2023 alleging embezzlement of about ₹72 crore between 2019 and 2021. The two sides only settled, withdrawing all litigation, in September 2024.

The turning point

The clearest before-and-after in BharatPe’s history is the governance crisis of January–March 2022 itself. Before it, the company was a Grover-fronted growth story: revenue from operations of roughly ₹321 crore in FY22 sat against a total loss of ₹5,610 crore for the year, a number BharatPe attributed largely to a non-cash fair-value markdown on its compulsorily convertible preference shares (CCPS) rather than to cash burn, as Business Standard reported in January 2023. After it, under interim and then confirmed CEO Nalin Negi — BharatPe’s CFO since 2021, who took the top job on an interim basis in January 2023 and was made permanent CEO in April 2024 — the company’s reported net loss fell to ₹941 crore in FY23, ₹474–492 crore in FY24 (figures differ slightly between Entrackr’s October 2024 report and AngelOne’s September 2025 comparison table), and ₹88.2 crore in FY25, alongside a company-stated adjusted pre-tax profit of ₹6 crore excluding employee stock option costs for FY25, according to Business Standard’s August 2025 report citing CEO Negi. The founder who built the brand left; the numbers that mattered kept improving without him.

The money behind it

BharatPe’s capital table reads like a tour of the 2018–2021 Indian venture boom. Peak XV Partners (then Sequoia Capital India) was an early backer, participating from around the 2018 seed stage, per Tracxn’s funding records. The company reached unicorn status in 2021: Business Standard reported a $900 million valuation at the Series D round in February 2021, before the Series E — $370 million led by Tiger Global in August 2021, with Coatue Management, Ribbit Capital, Insight Partners, Amplo and existing backers also participating, alongside new entrants Dragoneer Investment Group and Steadfast Capital — took the valuation to $2.85 billion, according to both Business Standard and TechCrunch’s contemporaneous coverage. Total funding raised since 2018 is reported inconsistently across trackers depending on whether debt rounds are included: Inc42 puts the figure at close to $850 million as of 2025, while CBInsights lists roughly $865 million across 20 rounds. No primary equity round above the 2021 mark has been publicly confirmed since; a September 2025 secondary transaction, in which a stake changed hands for ₹179 crore, was reported by Inc42 without a headline company valuation attached. CEO Negi told Business Standard in August 2025 that BharatPe planned a fundraise ahead of an initial public offering, with the IPO itself not expected within that fiscal year; by February 2026 he was framing the IPO timeline as 18–24 months out.

How it makes money

The part most people get wrong about BharatPe is assuming the QR code and soundbox are the business. They are not: BharatPe charges merchants no fee to accept UPI payments, so the payment-acceptance layer is a loss-leading acquisition channel, not a profit centre. According to the company’s own FY25 disclosures as summarised by Inc42, its recorded income comes from “transaction and service fee, and allied payments” and from acting as a lending-services provider. The lending side is where the spread lives: multiple industry breakdowns of BharatPe’s merchant-credit product, including an analysis published by buildd.co, describe the company charging roughly 2% a month to the borrowing merchant while passing on roughly 1% a month to the partner NBFC that actually books the loan — a spread of about one percentage point a month that BharatPe earns for originating, underwriting with transaction data, and servicing the loan, without carrying the full credit risk on its own balance sheet. Because BharatPe is not itself a bank or NBFC for most of its merchant lending, it depends on partner lenders’ balance sheets and risk appetite to keep disbursing; its Unity Small Finance Bank stake is one way it has tried to bring part of that lending, and the deposit-taking that funds it, in-house. On the cost side, FY25 filings summarised by AngelOne show employee costs of ₹360 crore, transaction-processing charges of ₹390.7 crore, and a sharp rise in financial-guarantee costs to ₹240 crore from ₹83 crore a year earlier — a line that tracks directly with how much lending risk BharatPe itself is now guaranteeing rather than passing entirely to partners.

The numbers

Figures below are consolidated, in ₹ crore, drawn from company results as reported by Business Standard, Entrackr and AngelOne.

Read across the four years, revenue growth (roughly fivefold from FY22 to FY25) has mattered less to the turnaround story than cost discipline: total expenses in FY25, at ₹1,906 crore, were marginally lower than FY24’s ₹1,974.4 crore even as revenue rose, per AngelOne’s September 2025 breakdown of the results.

Where the money comes from

BharatPe does not publish a granular revenue split between its payments, lending and consumer-credit lines in the filings reviewed for this piece — a gap worth naming rather than papering over. What is disclosed is the shape of the cost base, and it tells its own story about where the company’s effort now sits. Financial-guarantee costs — the accounting line for risk BharatPe itself has agreed to absorb on loans it originates — nearly tripled to ₹240 crore in FY25 from ₹83 crore in FY24, even as advertising and marketing spend was cut by 88%, from ₹162.7 crore to ₹26.2 crore, according to AngelOne’s account of the FY25 results. In plain terms: BharatPe spent far less trying to acquire new merchants and users in FY25, and took on more of its own lending risk instead of routing all of it to partner NBFCs — a shift from a growth posture to a margin posture. On the banking side, BharatPe holds a minority stake in Unity Small Finance Bank, the vehicle that, alongside the Centrum group (which holds the majority 51%), took over the fraud-hit Punjab and Maharashtra Co-operative (PMC) Bank after the Reserve Bank of India granted the consortium a small finance bank licence in October 2021, per Business Standard’s reporting at the time.

The risks

The first risk is one BharatPe has already lived through rather than merely disclosed: founder and governance risk. The 2022 crisis, the multi-year litigation between Nakrani and Grover that followed, and the eventual September 2024 settlement all show how much cost — reputational and in management attention — a co-founder dispute can impose on a company that depends on merchant and investor trust. The second is regulatory and counterparty dependence in lending. Because much of BharatPe’s earnings come from a spread on loans booked by partner NBFCs and increasingly guaranteed in part by BharatPe itself — reflected in FY25’s tripled financial-guarantee cost line — any tightening by the Reserve Bank of India of digital-lending or default-guarantee norms, or a pullback by a partner lender, would compress the spread that makes the lending business worth running at all. The third is the drag of Unity Small Finance Bank’s inherited balance sheet: the bank exists specifically to absorb PMC Bank’s legacy, fraud-hit deposit book, and any slow resolution of those liabilities ties up capital and management bandwidth for BharatPe as a part-owner, separate from its core payments and lending operations.

The takeaway

The most useful lesson in BharatPe’s history is not about fintech or even about India’s UPI boom. It is that the fastest way to find out what a company’s business model actually is happens to be an accident nobody would choose: remove the founder everyone assumed was indispensable, and watch which parts of the business keep making money without him. BharatPe’s soundbox kept beeping, its QR codes kept scanning, and — more slowly, and only after several difficult years of loss reduction — its lending spread kept narrowing the loss, all while the person who had put the company on television was suing his own co-founder in a different courtroom entirely.

Frequently asked questions

Who founded BharatPe?

BharatPe was incorporated in March 2018 by Bhavik Koladiya and Shashvat Nakrani. Ashneer Grover joined weeks later as co-founder and managing director through a transfer of shares, a distinction later contested in a 2023 Delhi High Court case that Grover won.

What happened between Ashneer Grover and BharatPe?

Following a January 2022 controversy over a leaked audio clip, BharatPe’s board conducted an internal review that led to the February 2022 termination of Grover’s wife Madhuri Jain from her role at the company, Grover’s resignation from the board in March 2022, and a May 2022 announcement that BharatPe would claw back his restricted shares over alleged financial misappropriation. The two sides settled all related litigation in September 2024.

How much is BharatPe worth?

The last publicly confirmed valuation is $2.85 billion, set at an August 2021 Series E round led by Tiger Global, according to Business Standard and TechCrunch. No higher primary-round valuation has been publicly reported since, as of September 2026.

Is BharatPe profitable?

Not on a statutory net-profit basis: BharatPe reported a net loss of ₹88.2 crore for FY25 (year ended March 2025). The company has said it reached an adjusted profit before tax of ₹6 crore for the same year after excluding employee stock option costs, per its statements reported by Business Standard in August 2025.

Does BharatPe own a bank?

BharatPe holds a minority stake in Unity Small Finance Bank, a consortium formed with the Centrum group (which holds the majority stake) that received a small finance bank licence from the Reserve Bank of India in October 2021 specifically to take over the troubled Punjab and Maharashtra Co-operative (PMC) Bank.

Sources

Figures are as of September 2026. Currency converted at $1 ≈ ₹96.0 as of 18 September 2026 (Trading Economics).

• Business Standard, “BharatPe’s valuation crosses $2.85 bn in $370 mn equity round”, August 2021
• TechCrunch, “India fintech BharatPe valued at $2.85 billion in Tiger Global-led $370 million funding”, August 2021
• Business Standard, “BharatPe raises Rs 786 crore in Series D funding at Rs 6,552 cr valuation”, February 2021
• Business Standard, “RBI issues SFB licence to Centrum-BharatPe consortium”, October 2021
• Business Standard, “Unity Small Finance Bank begins operations, paving way for merging PMC”, November 2021
• TechCrunch, “BharatPe founder Ashneer Grover resigns from board amid turmoil at Indian fintech”, February–March 2022
• TechCrunch, “BharatPe founder Ashneer Grover siphoned off money, fintech startup says”, May 2022
• BusinessToday, “Did Ashneer Grover not co found BharatPe?”, March 2022
• BusinessToday, “BharatPe co-founder Bhavik Koladiya sues Ashneer Grover”, January 2023
• LexStart Partners, “The BharatPe-Ashneer Grover Saga: A Detailed Timeline”, accessed September 2026
• Business Standard, “BharatPe loses Rs 5,610 cr in FY22 after change in fair value of CCPS”, January 2023
• Business Standard, “BharatPe earns Rs 904 cr against a loss before tax of Rs 886 cr in FY23”, December 2023
• Entrackr, “BharatPe revenue climbs to Rs 1,426 Cr in FY24, losses shrink 50%”, October 2024
• AngelOne, “BharatPe FY25 Financials: Rs 1,667 Crore Revenue; Loss Drops 82% to Rs 88 Crore”, September 2025
• Business Standard, “Fintech firm BharatPe clocks Rs 6 crore in profitability in FY25”, August 2025
• Business Standard, “BharatPe to raise funds before IPO after FY26, says CEO Nalin Negi”, August 2025
• Outlook Business, “Who Is Shashvat Nakrani? The Co-founder Who Built BharatPe at 19, Now Steps Back”, April 2026
• 5paisa Finschool, “Ashneer Grover: The Story of BharatPe Co-Founder & Managing Director”, accessed September 2026
• Inc42, “BharatPe FY25: Loss Narrows 82% To INR 88 Cr”, September 2025
• CBInsights, BharatPe financials and funding data, accessed September 2026
• buildd.co, “How BharatPe’s INR 5594 crore loss making business relies on a risky foundation”, accessed September 2026
• Wikipedia, “BharatPe”, accessed September 2026

Found an error? Write to us and we’ll correct it in the open, dated, on the piece.