Travel fintech Niyo set for comeback with new products to double revenue after SBM India ban disrupted growth plans

“What we have tried to do since the beginning of this year, now that the core product is settled, is to add more products where customers can benefit and it can increase our revenue capacity,” Vinay Bagri, founder and CEO of Niyo, told Mint recently.

Niyo launched visa applications and flight bookings on its platform earlier this week. The company plans to offer hotel bookings and experiences by the end of September, Bagri said. The suite of new products along with those in the pipeline will help the company double its revenue next year, he said.

Although Niyo competes with established entities EaseMyTrip, Ixigo and Atlys, Bagri is confident about boosting revenue by targeting its existing customers initially.

“It will take another three months for the products to mature. By December, whatever improvements we want to do in product and placement will be done. So, once that is done, we think our revenue will double,” Bagri said, adding that he expects to enter FY26 with a profit, slightly readjusting its plan by a year.

Niyo’s recently announced products and services come almost 20 months after the RBI’s directive to SBM India stunted its prospects. The central bank ordered SBM to stop all transactions under the liberalised remittance scheme in January 2023, citing certain material supervisory concerns observed at the bank. The scheme allows Indians to send foreign currency of up to $250,000 overseas for specified reasons per financial year.

Tight regulation

“It was almost a year of setbacks for us… This was a major concern at the time as 60,000 people were using our product on the day the crisis occurred… Developing a compliant product in the tightly regulated fintech space with another bank took about a year, so much of FY24 was spent on this endeavour,” Bagri said.

SBM India has since been under regulatory scrutiny, with the RBI imposing a penalty of ₹88.7 lakh on the bank for non-compliance with regulatory norms, most recently in May this year.

Niyo, which operated the Niyo Global Card in partnership with SBM India, bore the brunt of the RBI’s decision and many of its customers were stranded overseas without any means of cash. The RBI subsequently allowed a 45-day extension for Niyo users stranded abroad to complete their trips and return to India.

Back then, Niyo launched zero forex secured credit cards as an immediate solution to alleviate the concerns of the customers, the company had said in a statement. Later, the company worked with other partner banks Equitas and DCB bank, which offered to upgrade their existing offerings into a new global product.

The setback to Niyo came when the company was in a transition period to strengthen its recently launched travel tech platform. In FY24, as the company worked to restore its footing, Bagri said that even though there was no spike in Niyo’s revenue and profit, it managed to maintain them at FY23 levels.

The company had tripled its revenue to ₹131.4 crore in FY23 and narrowed its losses. Niyo is yet to post its financials for the year with the ministry of corporate affairs.

Founded in 2015 by Bagri and Virender Bisht, Niyo operated primarily as a neobank allowing customers to open savings bank accounts and offering other banking-related services through its investing platform, Niyo Money.

The strategic shift towards travel banking was driven primarily by the success of its global card launched in 2018, which became a major revenue source.

“We realised very quickly in 2022 that it is not so easy to generate revenue, given how the regulation is and how the market is by just doing a savings account. And hence, from April of 2022, we migrated to largely cross-border customers,” said Bagri.

The company has so far raised over $170 million from investors such as Accel, Lightrock, and Prime Venture Partners, according to data on startup intelligence platform Tracxn.