Less than three years after its start, Chinese smartphone maker Xiaomi Corp. has closed its financial services division in India. Recently, the business took the Mi Pay and Mi Credit apps out of the national Play Store into its own app store. Mi Pay has also been taken off the NPCI’s list of authorised UPI apps because it allowed users to execute transactions on the nation’s UPI payments network.
Mi Pay has also been taken off the NPCI’s list of authorised UPI apps because it allowed users to execute transactions on the nation’s UPI payments network.
The abrupt collapse of the financial services branch is a setback for Xiaomi India, which leads the local smartphone market and aggressively extended its product selection to enhance revenues because the hardware part of the company has extremely slim profit margins.
“We closed the Mi Financial Services in March 2022 as part of the yearly strategy assessment effort and in response to improved focus on our core business services,” the firm spokeswoman told Reuters.
Xiaomi unveiled Mi Pay in India in March 2019. The app had over 20 million registered users in the country that year alone, according to corporate executives at the time.
In India, its largest market outside of China, Xiaomi is being investigated for allegedly cheating tax officials.
In April, India’s federal financial crime bureau froze $676 million worth of Xiaomi assets on the grounds that the business had transported money abroad illegitimately while masking the transfers as royalties.
The Chinese smartphone giant claims the action “essentially froze” operations in its vital Indian market, while it dismisses any charges of misconduct.
Many Chinese businesses have found it challenging to conduct business in India as a result of political unrest following a border incident in 2020.
Since then, India has tightened regulations for Chinese businesses investing in India and banned over 300 Chinese apps, including well-known ones like TikTok, citing security concerns.