DiGiSPICE FY26: Profitability Improves as the Bharat Agent Network Adds New Growth Levers

DiGiSPICE Technologies ended FY26 with a clearer operating leverage story. The company, which is in the process of merging Spice Money into the listed entity, reported revenue of INR 464.6 crore for FY26, up 4% year-on-year. The more important movement was in profitability. Gross margin rose 13% to INR 201.2 crore and EBITDA improved sharply to INR 20.8 crore, compared to a loss in FY25. PAT from continuing operations came in at INR 25.4 crore versus INR 6.5 crore in FY25.

Management framed FY26 as a year of strengthening the foundation while adding products that can lift unit economics. The core agent-led platform remains anchored in AePS cash withdrawal and collections, but the narrative is shifting toward UPI-led cash withdrawal (UPI Cash Point), BBPS-led collections, and transaction-backed credit.

A quick look at the operating model: Agent-led rails with a customer layer

Spice Money operates as a phygital platform where agents in Tier 3, Tier 4, Tier 5 and Tier 6 locations provide assisted digital payments and basic financial services. Management said the network reached close to 1.7 million agents by the end of March 2026 and serves nearly 170 million customers across about 2.6 lakh small towns. On a monthly basis, the company reported around 2.75 crore customers served.

Alongside the agent app, the company is building a consumer proposition through Spice Pay, described as a PPI wallet-based UPI account aimed at cash-first markets. The strategic intent is to move from an AePS-heavy assisted payments model to a broader UPI participation model where customers can transact directly.

FY26 financial performance: Margins expand faster than revenue

The FY26 financial table in the investor presentation highlights how a modest revenue growth rate translated into a much larger profitability jump.

Two points stood out in management commentary. First, revenue growth was said to be impacted by reclassification effects, even as customer GTV grew 10.5%. Second, the platform business drove most of the gross margin increase while indirect costs stayed nearly flat.

Quarterly volatility still exists. Q4FY26 revenue was INR 107.2 crore and gross margin was INR 48.6 crore. EBITDA for Q4FY26 was INR 1.3 crore, down versus Q3FY26. Management attributed the quarter-on-quarter margin dip to AePS subsidy cycles and year-end one-time adjustments, suggesting the full-year run rate is a better indicator than any single quarter.

Core rails: AePS scale remains intact, with market share gains

AePS remains the backbone of the platform. For FY26, AePS GTV was reported at INR 59,405 crore, up 15.9% year-on-year, and the company’s AePS off-us market share improved to 18.41% from 17.27% in FY25.

The company also highlighted a stable transaction success ratio above 70% in Q4, and said subscription packs have improved stickiness. The presentation stated that subscription-linked GTV contribution increased from 33% in FY25 to 44% in FY26.

A second AePS adjacent lever is cash deposit. The company showed steady growth in AePS cash deposit GTV over time, attributing it to more banks integrating on the product. Management positioned this as a structural opportunity because it supports regular savings habits and deepens last-mile branchless banking.

UPI Cash Point: A new cash withdrawal rail that management is betting on

A notable addition is UPI Cash Point, described as a QR-based cash withdrawal facility using UPI apps at agent or merchant points. Management said the product went live in March 2026 and argued it could be a larger opportunity than AePS because UPI adoption is broader and the customer journey is simpler than biometric authentication.

In the concall, management said the business had already reached a run rate of about INR 100 crore of monthly GTV and indicated strong month-on-month growth as more UPI apps go live on the platform. They also linked this product to geographic expansion, especially into South India where UPI usage is strong.

Importantly, management clarified that UPI Cash Point does not require a separate regulator license in the way a PPI does, but it does require bank partnerships under the business correspondent framework. They emphasized that the primary moat is building and maintaining a large on-ground agent network.

Collections: BBPS becomes the strategic counterweight to CMS pricing pressure

Collections remained large, but the mix is changing. FY26 collections GTV was reported at INR 52,051 crore versus INR 48,472 crore in FY25, a 7.4% increase. Management repeatedly pointed to the competitive pricing environment in CMS collections and indicated that the shift toward BBPS is the strategic priority.

BBPS growth was cited at 12% for FY26, and BBPS contribution to collections GTV increased from 9% in Q4FY25 to 13% in Q4FY26. The company’s stated focus is to transition enterprise clients from CMS toward BBPS Agent Mode to deepen digitization and improve efficiency.

Financial product distribution: CASA, float, and cross-sell runway

The distribution layer is increasingly being positioned as a margin enhancer.

The company reported 16.5 lakh plus lifetime accounts opened and said FY26 saw 1.6x year-on-year growth in accounts opened. Float balance was stated at over INR 305 crore with 45% year-on-year growth, and management said average bank balance per account is around INR 1,800. They also mentioned recurring float income of upwards of INR 50 lakhs per quarter.

The company opened 210 plus banking outlets with NSDL by Q4FY26. However, management cautioned that the broader rollout of business correspondent banking outlets depends on RBI guideline clarity, expected after the consultation process that management said would conclude by the end of June.

In terms of new product additions, FY26 saw distribution of FD-backed credit cards and insurance. Management indicated that more insurance products are in the pipeline and that savings and investment products are planned in coming quarters.

Credit: Embedded finance scales and management flags breakeven proximity

Credit is being built on transaction data from agents, using partner lenders and an FLDG-backed underwriting model. The company reported embedded finance or Adhikari loans disbursements of INR 66.7 crore in FY26 versus INR 20.5 crore in FY25. The number of loans disbursed increased to 12,228 in FY26 from 4,542 in FY25.

Management described the growth drivers as repeat loans, increasing ticket sizes, stable portfolio quality, and platform-led operational efficiencies. They also launched Vyapaar Loan, an MSME lending product, with Muthoot in Q3 FY26.

On profitability, the presentation stated credit operations are nearing breakeven, and the finance team said they expect the credit engine to become EBITDA positive in the near term.

Management also disclosed the interest rate band charged in Adhikari loans as around 32% to 36%, with lower rates for repeat borrowers, and a directional intent to reduce rates as underwriting confidence improves.

Takeaways

DiGiSPICE’s FY26 update shows a business that is still rooted in transaction scale, but is now pushing harder on product mix and operating leverage. The agent network and AePS market share remain the foundation. The next set of levers are UPI Cash Point for cash withdrawals, BBPS for more scalable collections, and embedded credit for higher-margin growth.

Execution in FY27 will hinge on three practical factors that management itself pointed to: scaling UPI Cash Point with broad UPI app compatibility, continuing the BBPS mix shift despite CMS pricing pressure, and navigating regulatory clarity around business correspondent banking outlets. Alongside these, the merger process remains a key corporate milestone to watch.