FINO Payments Bank Eyes ₹100 Crore Profit in FY26 Amid Strong Digital Shift
FINO Payments Bank, a prominent player in India’s fintech space, has unveiled an ambitious roadmap for FY26 as it aims to achieve a net profit of ₹100 crore. This sharp growth target comes on the back of rising digital adoption, expanding merchant reach, and a strong push towards financial inclusion. The bank’s strategic evolution highlights the growing confidence of fintech institutions in tapping India’s underserved markets through tech-driven solutions.
Riding the Digital Momentum
A key pillar of FINO’s growth plan is its increasing focus on digital transactions. The bank anticipates that around 49% of its transactions in FY26 will be digital, a significant leap from just 21% in the previous year. This reflects the larger industry-wide trend of customers shifting from cash-based dealings to convenient digital platforms.
The bank expects its revenue from digital channels to exceed 25% in the current fiscal. This marks a strategic shift not just in service delivery but also in profitability, as digital transactions typically come with lower operating costs and higher margins. Tools like QR codes, PoS machines, and innovative audio-based payment confirmations are now key enablers in FINO’s ecosystem.
Expanding Reach and Product Portfolio
FINO’s network of merchants has now surpassed 1.9 million across India, forming the backbone of its services. These merchants function as local banking points, allowing the bank to serve customers even in the most remote regions. This widespread reach supports the bank’s hybrid model—combining physical access with digital efficiency.
In terms of offerings, FINO is stepping up innovation. It is developing new digital products like Soundbox devices that deliver voice alerts for transactions—ideal for small shopkeepers in busy or noisy environments. It is also working on offline QR solutions that enable transactions even in areas with poor connectivity.
Moreover, the bank plans to expand its prepaid instruments, digital wallets, and bulk disbursement services. These enhancements aim to increase usage among both customers and merchants, encouraging repeat transactions and improving user stickiness.
Robust Customer Base
As of March 2025, FINO serves over 1.43 crore users, of which 53 lakh are active on digital platforms. This shows a growing customer preference for mobile-based and remote banking services. The company’s strong customer base, particularly in Tier 2 and Tier 3 regions, provides it with a competitive advantage over digital-only players that often struggle to build trust beyond urban centers.
Strong Financial Performance in FY25
FINO ended FY25 on a high note, recording a 30% jump in revenue, rising from ₹150 crore in FY24 to ₹195 crore. Its net profit stood at ₹93 crore, reflecting an annual growth of over 8%. Return on Equity (ROE) and Return on Capital Employed (ROCE) were 13.6% and 6.67%, respectively. These numbers showcase the company’s operational efficiency and its readiness to scale sustainably.
With consistent earnings and improved margins from digital operations, FINO believes reaching ₹100 crore in profit for FY26 is well within reach.
Cost Efficiency and Deposit Growth
The bank has been focusing on maintaining a lean cost structure. Its cost-to-income ratio is targeted around 25%, a mark of financial discipline that boosts long-term sustainability. To further strengthen its foundation, FINO is working on increasing its CASA (Current and Savings Account) base—essential for reducing the cost of funds and enhancing interest income margins.
Looking Ahead: Plans to Become a Small Finance Bank
One of the most significant developments on the horizon is FINO’s plan to transition into a Small Finance Bank (SFB). This change would allow the institution to expand its lending capabilities, offer fixed deposits, and introduce new loan products like housing and MSME financing.
The transformation from a payments bank to an SFB is expected to open doors to a broader customer base and improve revenue streams. More importantly, it would enable FINO to serve its existing network with an extended range of services, strengthening its position in the rural and semi-urban banking ecosystem.
Challenges and Competitive Landscape
Despite its strengths, FINO operates in a highly competitive fintech market. Established players and emerging neobanks are rapidly gaining ground in the digital space. Companies like Jio Payments Bank, Paytm Payments Bank, and app-based challengers like PhonePe and Jupiter are all vying for market share.
However, FINO’s edge lies in its deep physical reach combined with tech-enabled delivery—a combination that many digital-only players cannot yet replicate effectively.
Conclusion
FINO Payments Bank’s profit target of ₹100 crore for FY26 reflects its confidence in the evolving digital landscape and its ability to serve India’s vast underserved population. With a strong merchant network, growing digital revenue, and plans to upgrade to a Small Finance Bank, FINO is well-positioned for the next phase of its journey.
If successful, it will not only mark a milestone for the company but also reinforce the potential of hybrid fintech models in driving financial inclusion and profitability across India.
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The image added is for representation purposes only
