PhysicsWallah (PW), which is preparing for its IPO, has decided to step back from its plan to directly offer education loans to students. The edtech company has scrapped its in-house lending strategy and will no longer use FinZ Finance Private Limited, the NBFC subsidiary it had created for this purpose.
Earlier, PhysicsWallah had invested ₹120 crore into FinZ Finance to build a student lending business. The move was seen as an attempt to expand beyond its core education business and create an additional source of revenue. However, the company has now changed its approach and chosen a partnership-based model instead of running a lending business on its own.
PhysicsWallah Chooses Partnership Model Over Direct Lending
Under its revised strategy, PhysicsWallah will work with established and regulated NBFCs to provide education financing to students. Rather than giving loans directly, the company will act as a platform that connects students with lending partners.
This shift is expected to help the company avoid the regulatory challenges and financial risks that come with operating an NBFC. At the same time, students will still be able to access education loans through trusted lending institutions associated with the platform.
Strong Market Response and Revenue Growth
Investors have reacted positively to the decision. Between June 2 and June 4, 2026, PhysicsWallah’s share price surged by around 15% to 18% during intraday trading, making it one of the top-performing stocks in the market during the period. The rally also led to a significant increase in the company’s market valuation.
The positive sentiment was further supported by the company’s strong business performance. PhysicsWallah reported a 25% rise in revenue, driven mainly by higher student enrolments across its courses and educational programmes.
While many investors view the shift as a move towards a lower-risk business model, some market experts are still debating whether exiting direct lending so quickly is a smart strategic decision or a missed growth opportunity. As the company moves closer to its IPO, its future growth plans and execution will remain under close watch.