PhonePe Shuts Down US Engineering Unit to Consolidate Operations

Indian fintech major PhonePe has officially closed its US engineering office, marking the end of a four-year effort to maintain a specialized technical presence in the Bay Area. The decision follows a strategic review by the Walmart-backed company, which determined that the output from the small team of seven to eight engineers did not justify the operational expenses involved in maintaining an overseas unit.

According to reports, the company is consolidating its mobile platform and engineering development back to its primary hubs in Bengaluru and other Indian locations. The move comes as part of a broader push to streamline cost structures amid a volatile global market environment. The US unit, which was established in 2022 and previously led by former Meta executive Gaurav Lochan, was originally intended to support the company’s infrastructure for its next wave of 300 million users.

Despite the closure, PhonePe continues to pursue international expansion through alternative channels. CEO Sameer Nigam recently confirmed that the firm has secured an international license from the Central Bank of the UAE, signaling a shift toward direct market entry in the Gulf region. This license will allow the fintech firm to deploy point-of-sale infrastructure and provide foreign-exchange services, marking the UAE as its first official overseas market.

The consolidation also occurs against a backdrop of shifting financial priorities. While PhonePe recorded an 11.5% rise in operating revenue to ₹7,920.5 Cr in FY26, its net losses widened to ₹2,792 Cr. The company’s IPO plans, which were initially filed via an updated draft red herring prospectus earlier this year, remain paused due to geopolitical uncertainties in West Asia and fluctuations in global equity markets. The firm continues to focus on domestic growth, recently announcing a partnership with Visa to expand cardless payment solutions across the Indian market.