Can PhysicsWallah Be Both Educator & Lender?

PhysicsWallah is betting big on student lending through its NBFC arm FinZ Finance, hoping to turn affordability into its next growth engine. However, the edtech major now faces the bigger challenge: scaling education loans while keeping lending discipline and regulatory risks in check

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In a move that echoes a controversial chapter in India’s edtech history, PhysicsWallah (PW) is betting big on student financing.

During the sector’s boom years, education loans emerged as a powerful growth lever for startups. Easy credit helped remove upfront affordability barriers, drive enrolments and support the sale of higher-ticket courses.

The strategy worked, at least for a while. But the model eventually began to unravel. The most prominent casualty was BYJU’S. Its aggressive reliance on third-party lenders to finance expensive courses triggered regulatory scrutiny, customer backlash and allegations of mis-selling. Financing stopped looking like a conversion tool and started looking like a structural risk. 

Now, PhysicsWallah is positioning its lending business as a new growth engine. The company believes it can scale education financing while avoiding the pitfalls that ensnared many of its peers.

So, what gives PhysicsWallah this confidence? And can it build a lending business without repeating the mistakes that tarnished edtech’s first experiment with credit?

PhysicsWallah’s Lending Ambitions

Ahead of reporting its FY26 earnings on Wednesday (May 27), the listed edtech major approved a capital infusion of ₹120 Cr into its wholly owned NBFC arm, FinZ Finance. The company said the move is aimed at expanding access to education loans for students for whom affordability remains a barrier.

In a post-earnings call, PhysicsWallah cofounder Prateek Boob said that FinZ began operation nearly two years ago via external lending partnerships. Over the past two years, PhysicsWallah disbursed education loans of over ₹200 Cr, while keeping NPAs below 1%. 

“These are small-duration loans of less than one year,” Boob said during the call. Around 70%........

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