Fino Payments Bank board has accepted Rishi Gupta's resignation as MD and CEO on Thursday, even after finding him 'fit and proper' to lead the bank for a second term. According to reports from The Economic Times, Gupta had requested voluntary early retirement from his leadership position through a letter dated May 21, effective after business hours on Thursday. The board's decision came despite their earlier assessment that no prima facie case could be made against Gupta following his involvement in a Directorate General of GST Intelligence (DGGI) investigation. As reported by The Economic Times, Gupta was earlier arrested in a case related to a fraud probe into goods and service taxes (GST) and was subsequently granted bail on March 26.
Simultaneously, the board approved the extension of interim CEO Ketan Merchant's tenure for up to three months effective from May 27. As reported by The Economic Times, this extension is subject to regulatory approval. Merchant, who serves as the bank's chief financial officer, was appointed as interim head after Gupta's arrest in February 2025. The board had previously approved Gupta's extension as head of the organisation before his legal troubles began, but the turn of events had forced the board to keep the reappointment process on hold until a reassessment of his role in the GST case.
Gupta, one of the founding members of Fino, was arrested on February 27 in an investigation related to alleged fake goods and services tax invoices by a business partner of Fino causing loss of income for the government. According to The Economic Times, Gupta was subsequently granted bail on March 26. The board had kept the reappointment process on hold until a reassessment of his role in the GST case, which ultimately led to his resignation despite their clearance. Fino is seeking to become a small finance bank and is navigating leadership challenges in the aftermath of Gupta's arrest.
On May 21, the board stated that based on consideration of documents available with the bank, including legal opinions and reports received, 'no prima facie case could be made out against Mr Rishi Gupta'. As reported by The Economic Times, this assessment came despite the ongoing legal proceedings related to the DGGI investigation. The board's clearance was made even as they accepted Gupta's resignation, indicating a separation of the legal assessment from the leadership decision. The board's view was based on the consideration of documents available with the bank as on date, including legal opinions and reports received and the facts emanated therefrom.
The board also extended Anup Agarwal's tenure for up to three months as interim CFO with effect from July 06. According to The Economic Times, this additional leadership change demonstrates the bank's continued focus on maintaining stable financial operations during the transition period. The bank reiterated that operations remain 'stable and uninterrupted' with no impact on customer services, while adding that it remains focused on operationalising its Small Finance Bank licence within RBI-prescribed timelines. A founding member of the Fino group, Gupta highlighted the institution's evolution from a Section 8 company into what he described as the first profitable and listed payments bank in India, and referred to the Reserve Bank of India's in-principle approval for the bank's transition into a Small Finance Bank.
