India, July 13 -- Bengaluru-based neobank Fi Money is grappling with serious challenges as its core lending business has failed to gain traction leading to a cash crunch and mass layoffs.

Once seen as a promising digital banking player, Fi now faces a weakening runway, product cutbacks, and an uncertain future.

Multiple sources told Inc42 that Fi's lending operations, once central to its revenue strategy, have been scaled back.

Despite claiming to have built its own NBFC infrastructure in a townhall in April 2024, Inc42 was unable to find any evidence of the company having an NBFC licence on the RBI portal. As per sources, the startup is still operating under a loan distribution model where it disburses loans on behalf of RBI-registere...