Fino Payments Bank has set its sights on achieving a significant milestone, aiming for a profit of Rs 100 crore in the fiscal year 2026 (FY26). This ambitious target is underpinned by the bank's growing focus on digital transactions, which are rapidly becoming a cornerstone of its operations.

Digital Transformation in Full Swing

CEO Rishi Gupta revealed that digital sources now account for a substantial 49.00% of the bank's transaction volume. This shift towards digital banking is a clear indicator of Fino's successful adaptation to changing consumer preferences and technological advancements in the financial sector.

Expanding Merchant Network

Fino Payments Bank continues to demonstrate robust growth in its merchant acquisition strategy. The bank is consistently adding between 1.50 to 2.00 lakh merchants annually to its network, which currently stands at an impressive 19.00 lakh merchants. This expanding network is crucial for increasing the bank's reach and transaction volumes.

Diversification and Future Plans

In a strategic move to broaden its product offerings, Fino Payments Bank is actively collaborating with Non-Banking Financial Companies (NBFCs) to introduce lending products. This partnership approach allows Fino to venture into credit services while leveraging the expertise of established NBFCs.

Aspiring for Greater Heights

Looking towards the future, Fino Payments Bank has taken a significant step by applying for a small finance bank license. This move, if successful, would allow Fino to expand its range of financial services and potentially accelerate its growth trajectory.

The bank's focus on digital growth, combined with its expanding merchant network and strategic partnerships, positions it well to pursue its ambitious profit target. As Fino Payments Bank continues to evolve and adapt to the dynamic financial landscape, it will be interesting to observe how these strategies unfold in the coming years.

Fino Payments Bank , a key player in India's financial services sector, is making strategic moves to elevate its status in the banking industry. The bank is currently in the process of transitioning into a small finance bank, a significant step that could reshape its business model and expand its service offerings.

Awaiting RBI Approval

The bank's plans hinge on receiving approval from the Reserve Bank of India (RBI) for a license upgradation. This crucial step is necessary for Fino Payments Bank to evolve from its current payments bank status to a small finance bank, which would allow it to offer a wider range of financial products and services.

Strategic Focus on Secured Loans

As part of its preparation for the transition, Fino Payments Bank has outlined a clear strategy focusing on secured loans. This approach suggests a more conservative lending policy, potentially aimed at maintaining a healthy balance sheet and minimizing risk exposure in its future operations as a small finance bank.

Building Organizational Capacity

In anticipation of the transition, the bank is actively working on building its organizational capacity. This likely involves enhancing its infrastructure, technology, and human resources to handle the expanded scope of operations that come with being a small finance bank.

Addressing Challenges in the Payments Bank Space

The move to transition into a small finance bank is seen as a strategic response to the challenges faced in the payments bank sector. One of the primary challenges has been the dominance of the Unified Payments Interface (UPI) in digital transactions, which has significantly impacted the revenue models of payments banks.

Implications for the Future

If successful, this transition could mark a new chapter for Fino Payments Bank, potentially allowing it to:

• Offer a broader range of banking services
• Expand its customer base
• Increase its revenue streams
• Compete more effectively in the evolving financial services landscape

As the banking sector continues to evolve, Fino Payments Bank's strategic move reflects the broader trend of financial institutions adapting to changing market dynamics and regulatory environments. Stakeholders will be keenly watching the outcome of the RBI's decision and the subsequent impact on the bank's operations and market position.

The timeline for the RBI's decision and the potential implementation of the transition remains to be seen. For now, Fino Payments Bank continues its operations as a payments bank while preparing for a future that could see it playing a larger role in India's banking sector.