Fino Payments Bank: FY26 Results & Path to Small Finance Bank

Overview

Fino Payments Bank Limited (BSE: FINOPB) released its audited FY26 and unaudited Q4’26 results on 29 April 2026. The bank highlighted strong deposit growth, record CASA renewal income, and a strategic transition to a Small Finance Bank (SFB) after receiving in‑principle RBI approval on 5 Dec 2025.

Financial Highlights

• Revenue: ₹1,587.9 cr for FY26, down 14% YoY.
• Net Revenue: ₹584.4 cr (stable YoY).
• Net‑Revenue Margin: Record 40% in Q4’26 (vs. prior quarters).
• Total Throughput: FY26 flat at ₹464,047 cr; Q4’26 down 17% YoY to ₹107,798 cr.
• Digital Throughput: FY26 up 16% YoY to ₹262,009 cr; Q4’26 down 13% YoY to ₹65,269 cr.
• Deposits: All‑time high ₹2,957 cr (as of 14 Mar 2026).
• CASA Renewal Income: ₹62.2 cr in Q4’26, +12% YoY.
• Referral Lending Disbursements: FY26 ₹1,285 cr; Q4’26 ₹592 cr (97% QoQ growth).

Operational Highlights

• Customer Base: 1.75 cr accounts, +6.9 lac in Q4’26 (≈3.2 lac added in March).
• Average Deposits: ↑20% YoY in Q4’26 to ₹2,535 cr.
• CBS Migration: Completed in Q4’26, laying groundwork for scalable growth.
• Asset‑Light Model: Continued focus on digital, low‑cost operations.

Strategic Initiatives

1. Transition to Small Finance Bank
   • RBI in‑principle approval (Dec 2025) makes Fino the first payments bank moving to SFB status.
   • Enables broader lending portfolio, higher‑margin products, and deeper financial inclusion.
2. Referral Lending Expansion
   • Leveraging merchant network to drive loan disbursements; Q4’26 saw a near‑doubling of referrals.
3. Technology Upgrade
   • Core Banking System (CBS) migration completed, improving processing efficiency and supporting future product rollout.

Regulatory & Legal Update

• Governance: Management reaffirmed commitment to strong governance, compliance, and risk management as it prepares for SFB licensing requirements.
• Legal Matter: Special Judge granted bail to Mr. Rishi Gupta (26 Mar 2026). The case involves program managers of multiple banks and is not related to Fino’s GST compliance. The matter remains sub‑judice, and the bank will continue disclosures as required.

Management Commentary

• Interim CEO Ketan Merchant emphasized the resilience of the deposit franchise and the pilot referral‑SFB model, outlining FY27 priorities around governance and an asset‑light SFB framework.
• Interim CFO Anup Agarwal highlighted the 40% net‑revenue margin and disciplined deposit cost structure as foundations for future profitability.

Outlook & Investor Implications

• Opportunities: SFB conversion could unlock higher‑margin lending, diversify revenue, and deepen market penetration in rural India.
• Risks: FY26 revenue decline, ongoing legal proceedings, and the need for additional capital to meet SFB regulatory capital norms.
• Short‑Term: Expect continued focus on margin improvement, CASA growth, and scaling referral lending.
• Medium‑Term: Successful SFB licensing could drive top‑line recovery and improve earnings quality.

Prepared for investors on 29 April 2026.