Fintechs Choose Co-Branded Cards to Earn More
Many fintech apps in India now use co-branded cards to earn money because UPI payments don’t bring direct income.
Google Pay and PhonePe are leading this trend by teaming up with banks to launch new co-branded card products.
Google Pay is working with Axis Bank on a credit card. PhonePe recently launched one with HDFC Bank for customers.
Why Fintechs Need Extra Income
Since UPI is free, apps like Google Pay can’t make money from each payment, even though billions happen every month.
So, they now offer loans, credit cards, and gold loans, earning money each time they help bring in new customers.
Sourcing a credit card can earn fintechs Rs 1,000 to Rs 1,200 per customer. Personal loans bring even higher commissions.
For gold loans, the earnings are smaller, usually less than 0.3% of the amount given to customers.
More Loans, More Users
Paytm gave out Rs 1,500 crore in loans in one quarter, while Google Pay disburses about Rs 50 crore monthly.
But many users check their credit scores without getting loans. Few people qualify because banks follow strict rules.
These apps help banks connect with users, but banks carefully check credit history before giving loans or cards.
Partnerships With Banks Are Key
Banks like L&T Finance partner with fintechs to give loans, but only to people with strong past credit history.
L&T Finance said they gave Rs 600 crore in loans through partners like Google Pay in just four months.
CEO Sudipta Roy added that they use credit reports and extra data to make smart loan decisions with low risk.
Global Tech Giants Join In
Amazon already offers a popular co-branded card with ICICI Bank, used by over five million people in India.
It also plans to buy Axio, a local finance company, to offer more credit services directly in the future.
This shows that global companies want to grow in Indian fintech by offering loans, cards, and other money tools.
Co-Branded Cards Are the New Focus
With UPI giving no income, co-branded card deals help fintechs earn money and keep users active on their apps.
The model is low-risk for fintechs. Banks handle credit checks, while apps help bring in customers and offer services.
As more users go digital, fintechs can earn by offering useful credit tools inside apps people already use every day.
The co-branded card approach brings income, trust, and more user time on app platforms. It’s now part of every big fintech plan.