Fino Payments Bank Ltd.की ऑडीटर रिपोर्ट

Mar 31, 2025

Fino Payments Bank Limited

Report on the Audit of the Financial Statements Opinion

We have audited the accompanying financial statements of Fino Payments Bank Limited (“the Bank”), which comprise the Balance Sheet as at March 31, 2025, the Profit and Loss account, the Statement of Cash Flow for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Banking Regulation Act, 1949 as well as the Companies Act, 2013 (“the Act’) and circulars and guidelines issued by the Reserve Bank of India (“RBI”) from time to time (“RBI guidelines”) in the manner so required for Banking Companies and give a true and fair view in conformity with the Accounting Standards prescribed under section 133 of the Act read with Companies (Accounting Standards) Rules, 2021 and other accounting principles generally accepted in India, of the state of affairs of the Bank as at March 31, 2025, and its profit, and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the “Auditor’s Responsibilities for the Audit of the Financial Statements” section of our report. We are independent of the Bank in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our opinion on the financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

Key Audit Matter	How our audit addressed the Key Audit Matter
¦ The Bank utilizes a complex IT infrastructure to facilitate	For the system audit, we employed IT experts to understand the
its daily operations. This infrastructure is crucial for	Bank’s IT general controls. Our audit processes included:
processing and recording substantial transaction volumes either through a single or several applications.	¦ Evaluating the Bank’s ITGC environment by understanding processes, mapping applications, and recognizing financial risks
¦ IT system reliability and security are critical for the	linked with the people-process-technology interface.
Bank’s operational efficiency. Given the high volume of daily transactions, IT controls are essential to ensure accurate data processing by applications and to facilitate necessary modifications.	¦ Confirming the design and operational effectiveness of crucial controls in user access management, change management, program development, and vulnerability management.
¦ To guarantee that these IT systems process data accurately, completely, and consistently—thereby supporting dependable financial reporting—robust IT	¦ Assessing the design and operational effectiveness of access control measures, including the granting, removal, and periodic review of access rights.
general controls (ITGC) and specific application controls	¦ Testing compensatory controls and executing alternative audit
are required.	procedures as needed. We also noted any modifications to the IT
¦ We consider ‘IT systems and controls’ as a key audit	framework during the audit period.
matter due to the extensive automation, the significant	¦ The audit aimed to provide reasonable assurance that the Bank’s
number of systems utilized by management, and the	IT controls are adequate, effectively designed, and implemented
complexity of the IT framework, which significantly	to maintain the integrity, confidentiality, and availability of the
influences the financial reporting system.	Bank’s financial and operational data.

Other Information

The Bank’s Board of Directors is responsible for the other information. The other information comprises the information included in the Annual Report, but does not include the financial statements and our auditor’s report thereon and the Basel II Disclosures under New Capital Adequacy Framework. The Annual Report is expected to be made available to us after the date of this auditor’s report.

Our opinion on the financial statements does not cover the other information and we will not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

When we read the Annual Report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and take appropriate action as applicable under the relevant laws and regulations.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

The Bank’s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance, and cash flows of the Bank in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Act, read with the Companies (Accounting Standards) Rules, 2021, and provisions of Section 29 of the Banking Regulation Act, 1949 and RBI Guidelines. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act and the RBI Guidelines for safeguarding of the assets of the Bank and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Board of Directors is responsible for assessing the Bank’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Bank or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are also responsible for overseeing the Bank’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

¦ Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;

¦ Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Bank has internal financial controls with reference to financial statements in place and the operating effectiveness of such controls;

¦ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management;

¦ Conclude on the appropriateness of Management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Bank’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Bank to cease to continue as a going concern;

¦ Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of the misstatements in the financial statements that, individually or aggregate, makes it probable that the economic decisions of a reasonable knowledgeable user of the financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning of the scope of our audit work and evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatement in the financial statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in Internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. The Balance Sheet and the Profit and Loss account have been drawn up in accordance with the provisions of Section 29 of the Banking Regulation Act, 1949 and Section 133 of the Act and relevant rules issued thereunder.

2. As required by sub-section (3) of section 30 of the Banking Regulation Act,1949, we report that:

a) We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purpose of our audit and have found them to be satisfactory;

b) The transactions of the Bank, which have come to our notice, have been within the powers of the Bank;

c) Since the key operations of the Bank are automated with the key applications integrated to the core banking system, the audit is carried out centrally as all the necessary records and data required for the purposes of our audit are available therein. During the audit period, we have visited 16 branches.

d) The profit and loss account shows a true balance of profit for the year then ended.

3. As required by Section 143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

b) In our opinion, proper books of account as required by law have been kept by the Bank so far as it appears from our examination of those books;

c) The Balance Sheet, the Profit and Loss account and the Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act read with relevant rules issued thereunder to the extent they are not inconsistent with the accounting policies prescribed by RBI;

e) On the basis of the written representations received from the Directors as on March 31, 2025, taken on record by the Board of Directors, none of the Directors are disqualified as on March 31, 2025, from being appointed as a Director in terms of Section 164 (2) of the Act;

f) With respect to the adequacy of the internal financial controls with reference to financial statements of the Bank and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”;

g) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014 (as amended), in our opinion and to the best of our information and according to the explanations given to us:

i. The Bank has disclosed the impact of pending litigations on its financial position in its financial statements - Refer note 38 to the financial statements;

ii. The Bank did not have any long-term contracts including derivative contracts for which there were any for material foreseeable losses; and

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Bank;

iv. 1) The Management has represented that,

to the best of its knowledge and belief, as disclosed in refer note 51 to the financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Bank to or in any other persons / entities, including foreign entities (‘Intermediaries’), with the

understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Bank (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

2) The Management has represented that, to the best of its knowledge and belief, as disclosed in refer note 51 to the financial statements, no funds have been received by the Bank from any persons/ entities, including foreign entities, that the Bank has directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

3) Based on such audit procedures performed, as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the management representations under sub

clause (1) and (2) as provided under (1) and (2) above contain any material misstatement.

v. The Bank has neither declared nor paid any dividend during the current year;

vi. Based on our examination which included test checks, the Bank has used accounting software systems for maintaining its books of account for the financial year ended March 31, 2025 which have the feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software systems. Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with and the audit trail has been preserved by the Bank as per statutory requirements for record retention.

h) With respect to the other matters to be included in the Auditor’s Report in accordance with the requirements of Section 197(16) of the Act, as amended, the Bank is a Banking Company as defined under Banking Regulation Act, 1949. Accordingly, the requirements prescribed under Section 197 of the Act do not apply.

Place: Navi Mumbai Date: April 28, 2025

For A P Sanzgiri & Co

Chartered Accountants Firm Registration Number: 116293W

Abhijit Sanzgiri

Partner

Membership Number: 043230 UDIN: 25043230BMIRWP4722

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Mar 31, 2024

We have audited the accompanying financial statements of Fino Payments Bank Limited (“the Bank”), which comprise the Balance Sheet as at March 31, 2024, the Profit and Loss account, the Statement of Cash Flow for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Banking Regulation Act, 1949 as well as the Companies Act, 2013 (“the Act’) in the manner so required for Banking Companies and give a true and fair view in conformity with the Accounting Standards prescribed under section 133 of the Act read with Companies (Accounts) Rules, 2014 as amended and other accounting principles generally accepted in India, of the state of affairs of the Bank as at March 31, 2024, and its profit, and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Bank in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the year ended March 31, 2024. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key Audit Matter

How our audit addressed the Key Audit Matter

> The Bank utilizes a complex IT infrastructure to facilitate its daily operations. This infrastructure is crucial for processing and recording substantial transaction volumes either through a single or several applications. > IT system reliability and security are critical for the Bank’s operational efficiency. Given the high volume of daily transactions, IT controls are essential to ensure accurate data processing by applications and to facilitate necessary modifications. > To guarantee that these IT systems process data accurately, completely, and consistently—thereby supporting dependable financial reporting—robust IT general controls and specific application controls are required. > We consider ‘IT systems and controls’ as a key audit matter due to the extensive automation, the significant number of systems utilized by management, and the complexity of the IT framework, which significantly influences the financial reporting system.

For the system audit, we employed IT experts to understand the Bank’s IT general controls. Our audit processes included: > Evaluating the Bank’s ITGC environment by understanding processes, mapping applications, and recognizing financial risks linked with the people-process-technology interface. > Confirming the design and operational effectiveness of crucial controls in user access management, change management, program development, and vulnerability management. > Assessing the design and operational effectiveness of access control measures, including the granting, removal, and periodic review of access rights. > Testing compensatory controls and executing alternative audit procedures as needed. We also noted any modifications to the IT framework during the audit period. > The audit aimed to provide reasonable assurance that the Bank’s IT controls are adequate, effectively designed, and implemented to maintain the integrity, confidentiality, and availability of the Bank’s financial and operational data.

Information Other than the Financial Statements and Auditor’s Report Thereon

The Bank’s Board of Directors is responsible for the other information. The other information comprises the information in the graphical representation of financial highlights and Director’s report but does not include the Financial Statements and our auditor’s report thereon. The Director’s Report which is expected to be made available to us after the date of this audit report.

Our opinion on the financial statements does not cover the other information and we will not express any form of assurance conclusion thereon.

In connection with our audit of the Financial Statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

When we read the Annual report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance under SA 720 ‘The Auditor’s responsibilities relating to Other Information’.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

The Bank’s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance, and cash flows of the Bank in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Act, and Banking Regulation Act, 1949 and the circulars and guidelines issued by the Reserve Bank of India (‘RBI’) from time to time (“the RBI Guidelines”). This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act and the RBI Guidelines for safeguarding of the assets of the Bank and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Board of Directors is responsible for assessing the Bank’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Bank or to cease operations, or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Bank’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

> Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

> Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Bank has internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.

> Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

> Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Bank’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Bank to cease to continue as a going concern.

> Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of the misstatements in the standalone financial statements that, individually or aggregate, makes it probable that the economic decisions of a reasonable knowledgeable user of the financial statements may be influenced. We consider quantitative materiality and qualitative factors in

(i) planning of the scope of our audit work and evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatement in the financial statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements for the year ended 31 March 2024, and are therefore, the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. The Balance Sheet and the Profit and Loss account have been drawn up in accordance with the provisions of Section 29 of the Banking Regulation Act, 1949 and Section 133 of the Act and relevant rules issued thereunder.

2. As required by Sub-Section (3) of Section 30 of the Banking Regulation Act, 1949, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit and have found them to be satisfactory;

b) The transactions of the Bank, which have come to our notice during the course of audit, have been within the powers of the Bank;

c) Since the key operations of the Bank are automated with the key applications integrated to the core banking system, the audit is carried out centrally as all the necessary records and data required for the purposes of our audit are available therein. During the course of our audit we visited 18 branches.

d) The profit and loss account shows a true balance of profit for the year then ended.

3. As required by Section 143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

b) In our opinion, proper books of account as required by law have been kept by the Bank so far as it appears from our examination of those books;

c) The Balance Sheet, the Profit and Loss account and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 to the extent they are not inconsistent with the guidelines prescribed by RBI;

e) On the basis of the written representations received from the directors as on March 31,2024 taken on record by the Board of Directors, none of the directors are disqualified as on March 31, 2024, from being appointed as a director in terms of Section 164 (2) of the Act.

f) With respect to the adequacy of the internal financial controls with reference to financial statements of the Bank and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”.

g) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Bank has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Schedule 41 to the financial statements;

ii. The Bank has made provision as at March 31, 2024, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts. The Bank does not have any derivative contracts as at March 31, 2024;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Bank;

iv. 1) The Management has represented that, to

the best of its knowledge and belief, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Bank to or in any other persons / entities, including foreign entities (‘Intermediaries’), with the understanding, whether recorded in writing or otherwise, that the Intermediary has, whether directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Bank (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

2) The Management has represented that, to the best of its knowledge and belief, no funds have been received by the Bank from any persons/ entities, including foreign entities, that the Bank has directly or indirectly, lend or invest in other

persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

3) Based on the audit procedures that we have considered reasonable and appropriate in the circumstances and according to the information and explanations provided to us by the Management in this regard, nothing has come to our notice that has caused us to believe that the representations made by the Management under sub clause (1) and (2) as provided under (1) and (2) above contain any material misstatement.

v. The Bank has neither declared nor paid any dividend during the year;

h) With respect to the other matters to be included in the Auditor’s Report in accordance with the requirements of section 197(16) of the Act, as amended, in our opinion and to the best of our information and according to the explanations given to us, the entity being a banking

company, section 197 of the Act related to the managerial remuneration is not applicable by virtue of Section 35B(2A) of the Banking Regulation Act, 1949.

i) Based on our examination which included test checks, the company has used accounting software’s for maintaining its books of account which has features of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with.

For A P Sanzgiri & Co

Chartered Accountants Firm Registration Number: 116293W

Abhijit Sanzgiri

Partner

Place: Mumbai Membership Number: 043230

Date: April 30, 2024 UDIN: 24043230BKBDVX4783

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Mar 31, 2023

INDEPENDENT AUDITOR''S REPORT

To

The Members of

Fino Payments Bank Limited

Report on the Audit of the Financial Statements
Opinion

We have audited the accompanying financial statements of Fino
Payments Bank Limited ("the Bank"), which comprise the Balance
Sheet as at March 31, 2023, the Profit and Loss account, the
Statement of Cash Flow for the year then ended, and notes to the
financial statements, including a summary of significant accounting
policies and other explanatory information.

In our opinion and to the best of our information and according to
the explanations given to us, the aforesaid financial statements
give the information required by the Banking Regulation Act, 1949

as well as the Companies Act, 2013 ("the Act'') in the manner so
required for Banking Companies and give a true and fair view
in conformity with the Accounting Standards prescribed under

section 133 of the Act read with Companies (Accounts) Rules, 2014
as amended and other accounting principles generally accepted in
India, of the state of affairs of the Bank as at March 31, 2023, and
its profit, and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on
Auditing (SAs) specified under section 143(10) of the Act. Our
responsibilities under those Standards are further described in the
Auditor''s Responsibilities for the Audit of the Financial Statements

section of our report. We are independent of the Bank in accordance
with the Code of Ethics issued by the Institute of Chartered
Accountants of India (ICAI) together with the ethical requirements
that are relevant to our audit of the financial statements under
the provisions of the Act and the Rules thereunder, and we have
fulfilled our other ethical responsibilities in accordance with these
requirements and the Code of Ethics. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the financial

statements for the year ended March 31,2023. These matters were
addressed in the context of our audit of the financial statements

as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.

Information Other than the Financial Statements
and Auditor''s Report Thereon

The Bank''s Board of Directors is responsible for the other
information. The other information comprises the information in
the graphical representation of financial highlights and Director''s
report but does not include the Financial Statements and our
auditor''s report thereon. The Director''s Report which is expected
to be made available to us after the date of this audit report.

Our opinion on the financial statements does not cover the
other information and we will not express any form of assurance
conclusion thereon.

In connection with our audit of the Financial Statements, our

responsibility is to read the other information identified above
when it becomes available and, in doing so, consider whether
the other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit, or otherwise

appears to be materially misstated.

When we read the Annual report, if we conclude that there is a
material misstatement therein, we are required to communicate

the matter to those charged with governance under SA 720 ''The
Auditor''s responsibilities relating to Other Information''.

Responsibilities of Management and Those Charged
with Governance for the Financial Statements

The Bank''s Board of Directors is responsible for the matters stated

in section 134(5) of the Act with respect to the preparation of
these financial statements that give a true and fair view of the
financial position, financial performance, and cash flows of the
Bank in accordance with the accounting principles generally
accepted in India, including the Accounting Standards specified
under section 133 of the Act, and Banking Regulation Act, 1949
and the circulars and guidelines issued by the Reserve Bank
of India (''RBI'') from time to time ("the RBI Guidelines"). This
responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act and the RBI
Guidelines for safeguarding of the assets of the Bank and for
preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making
judgments and estimates that are reasonable and prudent; and
design, implementation and maintenance of adequate internal
financial controls, that were operating effectively for ensuring the
accuracy and completeness of the accounting records, relevant to
the preparation and presentation of the financial statement that
give a true and fair view and are free from material misstatement,
whether due to fraud or error.

In preparing the financial statements, the Board of Directors
is responsible for assessing the Bank''s ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless
the Board of Directors either intends to liquidate the Bank or to
cease operations, or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the

Bank''s financial reporting process.

Auditor''s Responsibilities for the Audit of the
Financial Statements

Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor''s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with SAs will always detect a material
misstatement when it exists. Misstatements can arise from fraud
or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements.

As part of an audit in accordance with SAs, we exercise professional
judgment and maintain professional skepticism throughout the

audit. We also:

• Identify and assess the risks of material misstatement of the
financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to
provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than
for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the
override of internal control.

• Obtain an understanding of internal control relevant to the
audit in order to design audit procedures that are appropriate

in the circumstances. Under section 143(3)(i) of the Act, we
are also responsible for expressing our opinion on whether
the Bank has internal financial controls with reference to

financial statements in place and the operating effectiveness
of such controls.

• Evaluate the appropriateness of accounting policies used

and the reasonableness of accounting estimates and related
disclosures made by management.

• Conclude on the appropriateness of management''s use of the
going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt
on the Bank''s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required
to draw attention in our auditor''s report to the related
disclosures in the financial statements or, if such disclosures
are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our
auditor''s report. However, future events or conditions may
cause the Bank to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the
financial statements, including the disclosures, and whether

the financial statements represent the underlying transactions
and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding,
among other matters, the planned scope and timing of the audit

and significant audit findings, including any significant deficiencies
in Internal control that we identify during our audit.

We also provide those charged with governance with a statement
that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all

relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, related
safeguards.

From the matters communicated with those charged with
governance, we determine those matters that were of most
significance in the audit of the financial statements for the year
ended March 31, 2023 and are therefore, the key audit matters.
We describe these matters in our auditor''s report unless law or
regulation precludes public disclosure about the matter or when,
in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. The Balance Sheet and the Profit and Loss account have been
drawn up in accordance with the provisions of Section 29 of
the Banking Regulation Act, 1949 and Section 133 of the Act

and relevant rules issued thereunder.

2. As required by sub-section (3) of section 30 of the Banking
Regulation Act,1949, we report that:

a) We have sought and obtained all the information and
explanations which to the best of our knowledge and

belief were necessary for the purpose of our audit and
have found them to be satisfactory;

b) The transactions of the Bank, which have come to our
notice during the course of audit, have been within the
powers of the Bank;

c) Since the key operations of the Bank are automated

with the key applications integrated to the core banking
system, the audit is carried out centrally as all the
necessary records and data required for the purposes of
our audit are available therein. During the course of our

audit we visited 7 branches.

3. As required by Section 143(3) of the Act, we report that:

a) We have sought and obtained all the information and
explanations which to the best of our knowledge and

belief were necessary for the purposes of our audit;

b) In our opinion, proper books of account as required by

law have been kept by the Bank so far as it appears from
our examination of those books;

c) The Balance Sheet, the Profit and Loss account and the
Cash Flow Statement dealt with by this Report are in
agreement with the books of account;

d) In our opinion, the aforesaid financial statements comply
with the Accounting Standards specified under Section
133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014 to the extent they are not

inconsistent with the guidelines prescribed by RBI;

e) On the basis of the written representations received from
the directors as on March 31,2023 taken on record by the
Board of Directors, none of the directors are disqualified

as on March 31, 2023 from being appointed as a director
in terms of Section 164 (2) of the Act.

f) With respect to the adequacy of the internal financial
controls with reference to financial statements of the
Bank and the operating effectiveness of such controls,

refer to our separate Report in "Annexure A".

g) With respect to the other matters to be included in the

Auditor''s Report in accordance with Rule 11 of the
Companies (Audit and Auditors) Rules, 2014, in our

opinion and to the best of our information and according
to the explanations given to us:

i. The Bank has disclosed the impact of pending
litigations on its financial position in its financial

statements - Refer Schedule 41 to the financial
statements;

ii. The Bank has made provision as at March 31, 2023,
as required under the applicable law or accounting
standards, for material foreseeable losses, if any, on
long-term contracts. The Bank does not have any

derivative contracts as at March 31, 2023;

iii. There has been no delay in transferring amounts,
required to be transferred, to the Investor Education
and Protection Fund by the Bank;

iv. 1) The Management has represented that, to

the best of its knowledge and belief, no funds
have been advanced or loaned or invested
(either from borrowed funds or share premium
or any other sources or kind of funds) by the
Bank to or in any other persons / entities,
including foreign entities (''Intermediaries''),
with the understanding, whether recorded in
writing or otherwise, that the Intermediary
has, whether directly or indirectly lend or
invest in other persons or entities identified in
any manner whatsoever by or on behalf of the
Bank ("Ultimate Beneficiaries") or provide any
guarantee, security or the like on behalf of the
Ultimate Beneficiaries;

2) The Management has represented that, to

the best of its knowledge and belief, no funds
have been received by the Bank from any
persons/ entities, including foreign entities,
that the Bank has directly or indirectly, lend or

invest in other persons or entities identified
in any manner whatsoever by or on behalf of
the Funding Party ("Ultimate Beneficiaries") or
provide any guarantee, security or the like on

behalf of the Ultimate Beneficiaries;

3) Based on the audit procedures that we have
considered reasonable and appropriate in the

circumstances and according to the information
and explanations provided to us by the
Management in this regard, nothing has come

to our notice that has caused us to believe that
the representations made by the Management
under sub clause (1) and (2) as provided
under (1) and (2) above contain any material
misstatement.

v. The Bank has neither declared nor paid any dividend
during the year;

vi. As per proviso to rule 3(1) of the Companies
(Accounts) Rules, 2014 for maintaining books of
accounts using accounting software which has a
feature of recording audit trail (edit log) facility
is applicable w.e.f April 1, 2023 to the Company
and accordingly, reporting under Rule 11(g) of
Companies (Audit and Auditors) Rules, 2014 is
not applicable for the financial year ended March
31,2023.

h) With respect to the other matters to be included in the

Auditor''s Report in accordance with the requirements of

Section 197(16) of the Act, as amended, the Bank is a
Banking Company as defined under Banking Regulation
Act, 1949. Accordingly, the requirements prescribed
under Section 197 of the Act do not apply.

Other Matter

The audit of Financial statement of the Bank for the year ended
March 31, 2022 were audited by M S K C & Associates, who vide
their report dated May 16, 2022 expressed an unmodified opinion
on those financial results.

For A P Sanzgiri & Co

Chartered Accountants
Firm Registration Number: 116293W

Abhijit Sanzgiri

Partner

Place: Mumbai Membership Number: 043230

Date: May 02, 2023 UDIN: 23043230BGWNDI9417