Detailed Narrative
Strong FY25 Performance with Record Profitability
Fino Payments Bank delivered a robust FY25, marking its fifth consecutive year of profitability. Revenue grew 25% year-on-year to INR 1,847 crores, aligning with revised upward guidance. EBITDA increased 22% to INR234 crores, and PBT rose 26% to INR108 crores. The bank became a tax-paying entity from Q2 FY25, with PAT reaching INR92.5 crores, and has cleared all accumulated losses to date.
Digital Platforms Drive Significant Throughput and Revenue
The bank's digital throughput reached INR2.25 lakh crores in FY25, contributing 49% to the total throughput of INR4.6 lakh crores, demonstrating a significant shift in its business model. Digital revenue grew 4.2x year-on-year to INR390 crores in FY25, now accounting for 21% of total revenue. The UPI market share substantially increased from 1.27% in Q4 FY24 to 1.62% in Q4 FY25, highlighting strong digital adoption.
Robust CASA Growth and Expanding Customer Franchise
Fino Payments Bank's customer base reached an all-time high of 1.43 crores, with 33 lakh new customers added in FY25, including 8.6 lakh in Q4. CASA revenue increased 43% to INR544 crores, and renewal income grew 48% to INR190 crores, reflecting strong customer trust and stickiness. Average deposits grew 37% year-on-year, with peak deposits crossing INR 2,500 crores.
Strategic Progress Towards Small Finance Bank Conversion and Lending
The application for Small Finance Bank (SFB) conversion is with the RBI, with management indicating positive progress and building internal readiness. The bank is actively developing its loan referral business, with disbursements growing over 6x from INR30 crores in Q4 FY24 to INR200 crores in Q4 FY25 on its own merchant network. The target is to reach INR300 crores in monthly loan referrals in the first half of FY26.
Significant Investment in Core Banking and AI for Scalability
Fino Payments Bank is in advanced stages of overhauling its technology infrastructure, with its next-generation core banking platform scheduled to go live in Q1 FY26. FY25 capital expenditure for technology stood at INR165 crores, with an additional INR100 crores-plus planned for FY26. The bank is also embedding artificial intelligence in its tech stack to strengthen real-time risk management and operational efficiency.
Mixed Performance in CMS and Remittance Segments
The CMS business faced headwinds in the past two quarters due to stress in the MFI sector and increased competition, leading to a moderation in take rates from 0.21% in FY24 to 0.18% in FY25. The remittance business was impacted in Q3 FY25 by regulatory changes and a shift of customers to 'on-us' accounts, resulting in income cannibalization into CASA. Despite this, AePS showed signs of recovery in H2 FY25, with Q4 revenue growing 23% and throughput rising 10% YoY.