Edtech startup PhysicsWallah announced on June 4 that it will abandon its earlier plan to provide student loans directly through its NBFC subsidiary, FinZ Finance. Instead, the company will partner with third-party non-banking financial companies (NBFCs) to facilitate lending, aiming to reduce balance sheet and credit risks, according to a stock exchange filing (medianama.com).
PhysicsWallah had initially planned to invest Rs 120 crore in FinZ Finance, which received its NBFC license from the Reserve Bank of India in September last year and began lending operations in March 2026. However, following feedback from partners emphasizing the company's strength in community building and online education, the management decided to revise its lending strategy and will consider the future direction of FinZ Finance after board and regulatory approvals (medianama.com).
The move reflects a shift in strategy within the growing Indian edtech sector, where companies are balancing expansion into financial services with core competencies. By outsourcing lending to third-party NBFCs, PhysicsWallah aims to mitigate credit risks and focus on its primary business of online education. This approach contrasts with other edtech firms that have pursued direct lending to students, highlighting the challenges of managing financial services alongside educational platforms (medianama.com).
PhysicsWallah's revised strategy was disclosed in its June 4 stock exchange filing, with further decisions on FinZ Finance's role pending board and regulatory approvals (medianama.com).