Xiaomi ceases its financial services activities in India; here’s why
Chinese smartphone maker Xiaomi Corp has ceased its financial services business in India, less than three years after its launch. The company recently removed the Mi Pay and Mi Credit apps from the local Play Store and its own app store in the country. Mi Pay, which allowed users to transact on the country’s UPI payment network, was also removed from the NPCI’s list of approved UPI apps.
Mi Pay, which allowed users to transact on the country’s UPI payment network, was also removed from the NPCI’s list of approved UPI apps.
The abrupt closure of the financial services division is a setback for Xiaomi India, which dominates the local smartphone market and has aggressively expanded its product line to boost profits, as the company’s hardware division has extremely steep profit margins. thin.
“As part of the annual strategic review activity and in response to an increased focus on our core business services, we closed Mi Financial Services in March 2022,” the company’s spokesperson told Reuters.
In March 2019, Xiaomi launched Mi Pay in India. According to company executives at the time, the app had over 20 million registered users in the country that year alone.
Xiaomi is facing investigations in India, its biggest market outside of China, for allegedly evading tax authorities.
Xiaomi’s assets worth $676 million were frozen in April by India’s federal financial crime agency, which claimed the company sent money illegally overseas while disguising the transfers as royalties.
The Chinese smartphone company, which denies accusations of wrongdoing, says the action has “effectively halted” operations in its crucial Indian market.
Due to political tensions following a border clash in 2020, many Chinese companies have found it difficult to do business in India.
India has since banned more than 300 Chinese apps, including popular apps like TikTok, citing security concerns, and has also tightened rules for Chinese companies investing in India.