Google Pay, the popular digital payments platform, is undertaking a significant strategic shift in India. Moving beyond its role as a mere distributor for financial products, the company is now actively building its own comprehensive credit ecosystem. This ambitious plan was highlighted with the launch of its first native credit product.
From Distributor to Creator: The Credit Ecosystem Vision
For several years, Google Pay has facilitated personal loans on its platform through partnerships with banks and Non-Banking Financial Companies (NBFCs). However, the company has now taken a major step forward. On 17 December 2025, it announced the launch of its first co-branded credit card, marking a pivotal evolution in its business model.
Sharath Bulusu, Senior Director of Product Management at Google Pay, explained the strategic thinking behind this move. He stated that the company's goal is not just to leverage its massive distribution network but to develop a complete credit ecosystem for users. "We're not doing this simply because we have distribution power," Bulusu told Mint. The launch of the credit card, named 'Flex' on the RuPay network, is the first product built natively by Google Pay in India.
The Flex Card and Expanding Credit Access
The inaugural card under the Flex programme has been launched in partnership with Axis Bank. Google Pay plans to onboard more issuing partners in the coming months. Initially, the card is being rolled out to a select group of users before a wider release, including to customers new to credit.
Bulusu pointed out a critical gap in the Indian market: only about 20% of credit-eligible customers currently have access to formal credit. With an estimated 50 million cardholders in the country, growth has been stagnant. "That number has not budged by much," he noted, emphasizing that the true challenge and opportunity lie in bringing the remaining 80% into the formal credit fold.
While users have been able to tokenise and link existing cards for 'tap and pay' on GPay, the Flex card represents the platform's first foray into offering its own credit instrument. Bulusu views this as a natural extension of its personal loan offerings, which are now distributed in collaboration with four lending partners.
Building Value with Rewards and Repayment Flexibility
Beyond just issuing credit, Google Pay is focusing on enhancing the customer experience. A key area is simplifying repayment options and providing transparent value through rewards. The company has introduced a standardized rewards programme where users earn 'stars' for transactions.
"Every star is a reward, and you can redeem them on any transaction that you do afterwards," Bulusu explained. The redemption is designed to be instant, with credits reflecting directly on the statement without eligibility hurdles or waiting periods. The aim is to give rewards a "predictable value" and encourage continued engagement on the platform.
Looking ahead, Google Pay's vision for its credit ecosystem could include other forms of lending, such as credit lines linked directly to UPI. This move by the tech giant signals a deeper commitment to India's digital finance landscape, transitioning from a payments conduit to a multifaceted financial services provider aimed at democratizing credit access.
