Zomato declines NBFC License application of RBI of its subsidiary ZFSL

By Team Startupcity  |  Thursday, 04 July 2024, 16:49 IST

Zomato declines NBFC License application of RBI of its subsidiary ZFSL
Unicorn food tech platform Zomato has called off the plan of entering the non-banking financial company (NBFC) sector. The financial subsidiary of Zomato, Zomato Financial Services Limited (ZFSL) has recently decided to withdraw their application to operate as a non-banking financial company (NBFC).
This decision was taken during a meeting with Zomato Financial Services Limited (ZFSL).According to the statement of Zomato, the decision of withdrawal of the NBFC application will not at all impact the company's revenue or operations.
The company highlighted that,the disclosure was made by them voluntarily. The development follows the recent surrender of the payment aggregator license by another Zomato subsidiary, Zomato Payment Private Limited (ZPPL), earlier this year.
Zomato Payment Private Limited was established in 2021, with an aim to function as a payment aggregator and issuer of prepaid payment instruments. Despite these withdrawals, Zomato's core operations and financial health appear unaffected.
During an exchange filing, the company informed, "ZFSL, a wholly owned subsidiary of Zomato Limited, at its meeting held today i.e. July 2, 2024, has decided to voluntarily withdraw the application dated April 29, 2022, submitted with the Reserve Bank of India (RBI) for getting a certificate of registration for undertaking the business of a Non-Banking Financial Company (Type II NBFC-ND) as we do not wish to pursue the lending/credit business anymore."
On the other hand, with its food delivery platform, Zomato has recorded a profit of 175 crore for the fourth quarter ending March 31, 2024, marking the fourth consecutive quarter of profitability.
This marks a notable reversal from the 188 crore loss recorded in the fourth quarter of the preceding fiscal year.
Sequentially, Zomato saw a 26.8% increase in net profit, climbing to 138 crore in the third quarter of FY24. For the full fiscal year 2023-24, Zomato achieved a profit of 351 crore, marking a significant turnaround from the 971 crore loss reported in the preceding year.

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