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Food and grocery delivery company Zomato has decided to withdraw its application for a Non-Banking Financial Company (NBFC) license.
The announcement was made on Tuesday in an exchange filing by Zomato Financial Services Ltd, a wholly-owned subsidiary of Zomato.
The company clarified that the decision will not affect its revenue or operations.
After Zomato announced its decision to exit the lending business, its stock ended the day at ₹208.52, up 2.23% on the NSE.
Zomato’s previous forays into the lending business
Zomato initially ventured into the lending business in 2000 to support its partner restaurants during the Covid pandemic.
On May 29, it was reported that Zomato is in talks with several NBFCs to provide working capital loans to these partners.
The company incorporated Zomato Payment Private Limited in August 2021 for this purpose and registered Zomato Financial Services in February 2022.
Zomato fails to get NBFC license, writes off investment
Despite its efforts, Zomato failed to get an NBFC license.
According to a report by Money controlthe company surrendered its Payment Aggregator (PA) authorization and wrote down an investment worth ₹39 crore in Zomato Payment Private Limited (ZPPL) in the March quarter.
The move marked the end of Zomato’s venture into the lending business.
Zomato is currently in advanced talks to acquire Paytm’s movie ticketing and events business to expand its ‘going out’ offerings.
