Chinese manufacturing company for consumer electronics, Xiaomi has silently put a stop to its financial services in India, less than three years after introducing lending and payments apps in the crucial global market, according to two sources familiar with the situation who spoke to TechCrunch, backing away from what analysts estimate to be a $1 trillion opportunity.
Mi Pay and Mi Credit, which are the two apps by Xiaomi, have been pulled back by the Chinese giant in India from its own app store as well as from the local play store. An app that enabled people to make easy transactions on the UPI payments network of the country, Mi Pay is no longer a part of the recognized UPI apps by NPCI, which is the main industry body that looks after UPI. However, NPCI has not responded to any requests to comment on the same. Xiaomi India has faced a significant setback as a result of the sudden decline in the financial services business, which directs the nation’s smartphone market, and as the company’s hardware industry relies on razor-thin margins, the market has aggressively increased its offers in an effort to boost revenues.
The company was able to connect and support consumers in the number of thousands in a short period of 4 years.
According to a Xiaomi India spokesperson, the Mi financial services were stopped in March 2022 as a part of the annual strategic assessment activity of the company as well as a response to the developed concentration on the services which come under the core business of Xiaomi. The company was able to connect and support consumers in the number of thousands in a short period of 4 years. During this process, the company is assisting its customers by working with its partners.
Mi Pay by Xiaomi was launched in March 2019 in India. According to the company executives, more than 20 million registered users were gathered by the app in India in the same year. Later in 2019, Xiaomi launched Mi Credit, which is an app that lent people money between $70 to $1,400 at considerably low interest rates. It quickly granted loans to consumers through partners by looking at transaction information and other facts in users’ texts and call logs to assess their creditworthiness.
Manu Jain, then-head of Xiaomi India, stated to media outlets in August of last year that the business hoped to use the Mi Credit and Mi Pay apps to become one of the major players in India’s financial industry. According to him, India was the second-largest market for Mi Credit after China.
Mi Pay and Mi Credit, which are the two apps by Xiaomi, have been pulled back by the Chinese giant in India
Numerous industry titans, such as Facebook and Google, have entered the Indian digital finance market and are now providing small firms with loans through partners. According to projections from the Boston Consulting Group, the value of digital loans is estimated to reach $1 trillion by 2025. Jain, who has since moved to a different position inside the company, stated last year that the business was trying to add more financial services, such as credit line cards and gold loans, and insurance to the south Asian market.
The reason for the dismissal of Xiaomi’s financial services in the country is still unknown, but this step has been taken by the company at a time when the central bank of India has proposed strict regulations around lending in India, limiting the information they can access on a customer’s phone and requiring more extensive disclosures about the conditions of their credit agreement.