Fino 2.0: Reinventing a low-cost payment bank into a secured lending powerhouse

Fino Payments Bank, the first payments bank to receive an in-principle nod from the Reserve Bank of India (RBI) to transition into a small finance bank (SFB), is gearing up for a strategic shift that will expand its current business model significantly.

- Subhana Shaikh

Rishi Gupta, MD and CEO, Fino Payments Bank.

The transition will be a cautious one with a focus on secured lending, primarily loans against property (LAP), affordable housing, and, to some extent, gold loans, managing director and chief executive officer Rishi Gupta told Mint in an interview. Unsecured lending will be strictly limited and targeted, he said.

Following RBI's approval on Friday, the bank will look at a higher proportion of secured assets compared to unsecured assets, and is not very keen to work on the microfinance institutions’ lending space.

Beyond new products and portfolios, Gupta sees the SFB approval as a broader validation of Fino’s model and long-term viability: it gives employees stability, opens credit access for merchants, offers investors a differentiated SFB rooted in ₹2,306 crore in the quarter.