Fino Payments Bank, a subsidiary of Fino Paytech Limited, has applied for a small finance bank (SFB) licence with the Reserve Bank of India (RBI).

“During the quarter ended 31 December 2023, the Reserve Bank of India has received one application under the Guidelines for ‘on tap’ Licensing of Small Finance Banks in the Private Sector dated 5 December 2019 from Fino Payments Bank Limited,” the central bank said in a statement.

On 28 July, the bank’s board approved the proposal for the transition of the bank into an SFB. The payment bank also stated that they have constituted a committee to explore the possibility of group corporate restructuring.

“We have a net worth of Rs 600 crore and, thus, qualify to upgrade to a SFB. The minimum capital requirement for SFBs set by RBI is Rs 200 crore. We have applied for a SFB licence and are awaiting RBI’s approval,” Fino Payments Bank CEO Rishi Gupta told Indianbankingnews.com.

Fino Payments Bank started business operations on 30 June 2017. As per RBI guidelines, payments banks are allowed to apply for conversion into SFBs after five years of operations. They must also have a minimum paid-up voting equity capital or net worth of Rs 200 crore.

Fino Payments Bank reported consolidated net profit of Rs 19.5 crore in Q2 of FY24, up 41.5% from Rs 13.8 crore a year ago. Revenue grew 18.2% year-on-year to Rs 358.6 crore.