Although Xiaomi is a leader in the smartphone space in India, it has always had a troubled history in the country. We recently learned that the Indian government is considering banning Xiaomi phones that cost less than $150 to give its local industry a boost. In the past, it has also banned a couple of Xiaomi apps due to diplomatic tensions with China. Now, Xiaomi has announced that it is shutting down its financial services business in India.
Xiaomi launched Mi Pay in India in 2019 which allowed users to make transactions using India"s Unified Payments Interface (UPI). Following this, it also rolled out the Mi Credit app which lent between $70 and $1400 to people at low interest rates. A loan would be granted only if a user approved access to their call logs and texts to determine if they have a decent credit scores based on the financial data stored on their phone.
However, as TechCrunch now reports, both apps have been discontinued in India with Xiaomi pulling out of the country"s fintech sector completely. A company spokesperson told the media outlet that:
As part of the annual strategic assessment activity and as a response to enhanced focus on our core business services, we closed the Mi Financial Services in March 2022. In a short span of 4 years, we were able to connect and support thousands of customers. We are working with our partners and supporting our consumers during this process.
The actual reasons behind the sudden exit is unclear but is likely related to the government tightening its grip around apps providing financial services and demanding better and clearer disclosures around credit agreements. Xiaomi India"s former head is noted as saying that the company"s aim is to become a leading player in the fintech space. But it"s clear that the situation didn"t pan out exactly as the firm had hoped.
Source: TechCrunch