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The company has announced plans to exit the business of directly lending to students or providing student financing on its own. Instead, it will now adopt a partnership-led model by collaborating with Non-Banking Financial Companies (NBFCs) to facilitate education loans for students.
The decision comes shortly after PhysicsWallah announced an equity investment of ₹120 crore in its wholly owned subsidiary, Finz Finance Private Limited. However, the company has now indicated that it is reassessing the structure of its financial services business and introducing a new strategy aimed at reducing financial risk and improving capital efficiency.
Focus on a Partnership-Based Education Loan Model
According to the company, it has entered into agreements with several leading and regulated NBFCs to address the growing demand for student loans. PhysicsWallah believes that its core strengths lie in education and technology, while loan disbursement and risk management should remain the responsibility of specialized financial institutions with strong underwriting capabilities and financial expertise.
In its statement, the company said that students will continue to have access to education loans under the new arrangement, but the loans will no longer be provided directly from PhysicsWallah’s balance sheet. This move is expected to significantly reduce the company’s exposure to lending-related risks and capital requirements. At the same time, it will allow the company to focus more on expanding its educational services, strengthening its digital learning platforms and building a larger student community.
PhysicsWallah Co-founder Prateek Maheshwari said that feedback from investors and business partners consistently highlighted that the company’s greatest strengths are education, technology and community building. He emphasized that lending activities should remain with institutions that possess the expertise to assess and manage financial risks effectively.
Continued Focus on Facilitating Student Loans
According to Maheshwari, prudent capital allocation and shareholder value remain among the company’s top priorities. Based on this approach and stakeholder feedback, PhysicsWallah reviewed its earlier decision and ultimately chose to adopt a partnership-driven lending model.
He further clarified that the strategic shift is not intended to reduce students’ access to education financing. Instead, the company aims to work with financial institutions that can offer better loan products and faster approval processes. This, in turn is expected to make it easier for students to secure financial assistance for higher education.
Sources familiar with the matter said that PhysicsWallah is evaluating multiple options regarding its financial subsidiary, Finz Finance. These options reportedly include a potential sale of the company a merger with another financial institution or even the surrender of its NBFC license.
Decision on Finz Finance’s Future Expected Soon
The final decision regarding the strategic direction of Finz Finance will be taken after approval from the board of directors and relevant regulatory authorities. The company stated that all available options are being evaluated with a focus on long-term business objectives and shareholder interests.
Industry experts believe that this move will enable PhysicsWallah to concentrate more effectively on its core education business while ensuring that students continue to receive education loans through experienced and well-regulated financial institutions. The development also reflects a broader trend in the edtech sector, where companies are increasingly focusing on their primary business areas while reducing exposure to financial and lending-related risks.
