Lending tech startup Kissht’s net profit declined 18.6% to INR 160.62 Cr in FY25 from 197.29 Cr in the previous fiscal year.

The IPO-bound startup’s parent OnEMI Technology also saw its operating revenue fall over 20% to INR 1,337.47 Cr during the year under review from INR 1,674.45 Cr in FY24. The decline was driven by a fall in interest income, a sharp drop in penalty charges, and deferral of processing fees for long-term loans.

Meanwhile, total expenses decreased 20.7% to INR 1,136.42 Cr in FY25 from INR 1,432.86 Cr in the previous year. However, borrowing costs more than doubled to INR 164.40 Cr from INR 68.6 Cr in FY24. Staff costs rose 6.8% YoY to INR 193.24 Cr, while provisions for credit loss fell to INR 326.83 Cr.

Marketing and branding expanses dipped 11.6% to INR 95.7 Cr during the year under review from INR 107.6 Cr in FY24.

Founded in 2015 by Ranvir Singh and Krishnan Vishwanathan, Kissht offers various types of loans and financial products to individuals and small businesses, with a focus on providing instant and hassle-free credit solutions through its app.

While its flagship consumer-facing platform offers users instant credit, the startup also operates a separate app RING, which is focused on providing instant credit to customers reaching the platform through merchants. Kissht is also piloting a new platform, Conexo, for sourcing retail loan products, including credit cards, for other financial institutions.

The startup earns revenue through interest on loans. It also charges processing fees, late payment and foreclosure fees, and earns commissions from distribution of insurance products.

Earlier this week, Kissht filed its DRHP with SEBI. Its IPO will comprise a fresh issue of shares worth up to INR 1,000 Cr and an OFS of up to 88.8 Lakh shares.

At the end of March 2025, Kissht’s assets under management (AUM) stood at INR 4,086.64 Cr. Of this, INR 2,474.56 Cr, or 61%, were loans on its own books, while INR 1,612.08 Cr, or 39%, were off-book loans funded by partner financial institutions.

The startup’s business relies almost entirely on unsecured lending, which poses high default risks. Kissht’s gross non-performing assets (GNPA) rose to 2.89% in 2025 from 0.79% in FY24 and 0.05% in FY23. Net NPA stood at 0.25% in FY25 as against nil in FY24 and FY23.

The lending tech startup’s provision coverage ratio fell to 91.48% during the year under review from 100% in the previous two years. Notably, for a lender with minimal collateral, rising defaults can quickly eat into equity and capital buffers.

Cash flow is another pressure point. In FY25, OnEMI reported a negative operating cash flow of INR 661.43 Cr. Its NBFC subsidiary, Si Creva Capital Services, reported a negative operating cash flow of INR 824.99 Cr in FY25. This was not a one-off as both reported negative cash flows in FY24 as well.

In the DRHP, OnEMI said that the Reserve Bank of India inspected Si Creva and highlighted weaknesses such as missing policy requirements, questionable upgrades of bad loans back to standard status, complaints around recovery practices, and cases of non-compliance by recovery agents. Even so, it said it has corrected these issues, and no penalty was levied.

It is pertinent to note that Kissht operates in an industry which is regulated by the RBI. Major regulatory challenges can impact the startup’s business. For instance, in November 2023, the central bank increased the risk weight on unsecured retail loans, which raised funding costs and constrained lending. Borrowing costs of the startup are already high due to mid-tier credit ratings.

Kissht has also given guarantees exceeding INR 1,200 Cr on behalf of its Si Creva. Meanwhile, it is also facing a GST demand of INR 6.5 Cr, and promoters are contesting personal tax disputes of more than INR 255 Cr. In 2023, Si Creva also received summons from the ED to appear before it in connection with an investigation under Prevention of Money Laundering Act, 2002. The startup said there it has not received any further communication from the ED in this respect.

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