MUMBAI: Fino Payments Bank, which had suffered setbacks last year in terms of adding new customers due to ban on Aadhaar as well as Reserve Bank of India’s fiat, is now looking forward to expand its footprint by doubling its merchant network base and also keep intact its transaction fee-based business model.
The bank, which has around 95,000 merchants now, is adding 5,000 merchants every month, thereby aiming at around 2 lakh merchant points by the end of 2020, said Rishi Gupta, MD &CEO. While it is still awaiting a clear circular from the regulator on Aadhaar to restart E-KYC for onboarding customers, the bank has complied with regulations on not exceeding Rs 1 lakh in deposit in customer accounts by tying up with Suryoday Bank.
“NIM (net interest margin) for us is not that high. There is no real reason for me to push for more deposit acquisition. Our focus is on transaction, payment ecosystem. There is no inherent advantage we will get by building deposits,” Gupta said.
Small finance bank as an option would always be there for a payment bank, but Fino, Gupta said, is not inclined to take an asset-led model, where there is a need to continuously raise capital.“A very good bank has an NIM of 3 per cent. At zero risk, we are able to get 1 to 1.5 per cent NIM. Isn’t that a good income?” Gupta asked. The bank is looking to break even by next year, he said.