PB Fintech’s Growth Obsession Risks Turning Its Fortress into a Frontier

Policybazaar radically transformed Indian insurance by making it transparent. For more than a decade, its digital marketplace gave users price transparency, easy online comparison, and confidence in a sector notorious for opacity. The platform empowered users and forced traditional insurers to adopt customer-centric and tech-driven practices.

Policybazaar became the default name Indians thought of when seeking protection products. But market leadership breeds temptation. And its parent, PB Fintech, has never been shy about its ambitions. 

At its latest post-earnings conference call, despite reporting healthy numbers, investor questions centred around a worry whether PB Fintech is now straying into too many new lanes at once.

The company is no longer content with being India’s insurance supermarket. It is expanding into mutual funds, holistic household savings, and even healthcare integration. The management believes it can knit together a single ecosystem designed to retain customers for longer.

Growth vs Profitability
Moving into a combination of health and wealth offerings may sound like a richer value proposition, but it risks diluting the brand. In these new spaces, PB Fintech is not the pioneer. It is stepping into territory already occupied by heavyweight competitors—from deep-pocketed banks and digital-first wealth platforms to global insurers now turning to India’s growing middle class.

Paisabazaar, its credit and lending business, remains loss-making. With unsecured lending facing weak demand, the company is shifting towards secured products and exploring ways to monetise the platform.

PB Fintech Chief Executive Officer Yashish Dahiya was clear during the earnings call that the priority is growth. “We are clearly not optimising for profits right now,” he said in response to a question by an analyst from Bank of America Merrill Lynch. 

That philosophy reassures some long-term holders, but it also sharpens a fear that the company is taking its insurance fortress for granted. In the financial services arena, new segments always appear exciting, yet each adjacency demands capital, compliance muscle, and above all, management bandwidth.

Several analysts openly wondered whether genuine synergies exist between insurance and wealth products. A few pressed management to spell out how many customers are actually buying wealth products on the back of insurance relationships, and how much of that business generates repeat, high-margin revenue.

Even in the core franchise, the competitive picture is changing. PB Fintech still controls a significant share in health and term insurance, but growth rates are flattening. Larger insurers and fintechs with deeper pockets are now courting the same digital-first customers who once fuelled Policybazaar’s runaway rise.

Add rising regulatory scrutiny, and the risks are compounded. A recent penalty from the insurance regulator underscored that process lapses can be costly. Analysts voiced concern that the company’s energetic forays could expose it to a wider set of compliance pitfalls at a time when it can least afford distraction.

By the end of the call, sustainability of profitability, growth vs market headroom, business vertical challenges, and expansions emerged as key areas of concern for investors.

For a business that is 70% owned by institutional investors, these doubts cannot be dispelled with rhetoric about ecosystems. Investors would prefer to see management defend and deepen dominance in insurance before marching into new fronts.

That tension between breadth and depth is not unusual in the life cycle of a market leader. The challenge for PB Fintech will be to show that its investments in new verticals are not a symptom of drifting focus, but a disciplined extension of its core strengths. Until it can prove that to a sceptical investor community, each quarter’s earnings call will bring more questions than answers.