The development comes only days after the company announced an investment of approximately Rs 120 crore into FinZ Finance, its wholly owned subsidiary that received a non-banking financial company licence from the Reserve Bank of India in September 2025 and commenced operations earlier this year.
Under the revised strategy, PhysicsWallah has entered into partnerships with multiple regulated non-banking financial companies to facilitate student financing. The company informed stock exchanges that it is restructuring its lending approach and has tied up with several leading regulated third-party financial institutions to address student lending requirements.
According to the company, PhysicsWallah will continue to operate as a technology platform, connecting students with a carefully selected network of lending partners based on their educational journey and academic performance. The company stated that this model would significantly reduce balance-sheet exposure and credit-related risks.
Explaining the decision, co-founder Prateek Maheshwari said the company had received feedback indicating that its core strengths lie in education, community building and its online business rather than lending activities. He said lending operations are better handled by regulated third-party financial institutions that possess established underwriting capabilities and risk assessment frameworks.
Maheshwari further stated that prudent capital allocation and the protection of shareholder value remain the company’s foremost priorities. He said that, after considering feedback from partners, the company decided to revisit its original strategy and enable student financing through regulated third-party financial institutions.
PhysicsWallah also announced that the future direction of FinZ Finance will be determined at a later stage, subject to approvals from the company’s board and relevant regulatory authorities.
Investors responded positively to the announcement, with PhysicsWallah’s shares rising by as much as 17 per cent following the disclosure.
The move represents a notable strategic shift for a company that has emerged as one of India’s fastest-growing education businesses. In November 2025, PhysicsWallah became India’s first pure-play education technology unicorn to be listed on the stock market. The company sought a valuation of approximately 3.6 billion United States dollars and distinguished itself from competitors that struggled during a broader downturn in the sector.
The company’s public listing came at a time when several major education technology firms in India were facing significant challenges. Byju’s remains involved in insolvency proceedings and legal disputes, while competitors including Unacademy have faced slowing growth and restructuring efforts. Unacademy is currently awaiting approval for its proposed merger with upGrad.
The latest decision comes amid increasing investor scrutiny of education technology business models, particularly regarding profitability, risk exposure and long-term sustainability.
PhysicsWallah also reported strong financial performance for the quarter ended March 2026. Revenue increased by 51 per cent year-on-year to Rs 919 crore, while losses narrowed by 76 per cent to Rs 69 crore.
At the time of the company’s initial public offering, co-founder Alakh Pandey emphasized that disciplined growth would remain a key priority as PhysicsWallah expanded its network of physical learning centres across India. He stated that the company aims to operate with discipline, pursue responsible growth and create value for all stakeholders while continuing its rapid expansion without compromising execution.
The strategic withdrawal from direct lending highlights PhysicsWallah’s focus on its core education business while reducing financial risk exposure. The move reflects a broader shift within India’s education technology sector, where investors are increasingly demanding sustainable growth, stronger governance and disciplined capital allocation.
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