Rishi Gupta, MD & CEO of Fino Payments Bank
Industry members have requested the intervention of Union government in the arrest of Fino Payments Bank MD and CEO Rishi Gupta, who has been moved to Hyderabad by the Directorate General of GST Intelligence (DGGI).
The Hyderabad unit of DGGI is reportedly probing whether Gupta was involved in an international online gaming syndicate. Gupta was arrested in Mumbai on late Friday, and the GST authorities are reportedly tracking the trail of illicit funds generated from real-money online gaming into non-KYC compliant bank accounts, and shell entities. Phone calls and messages sent to Fino Payments Bank officials remained unanswered till the time of publication.
In a press release, Ketan Merchant, CFO of Fino Payments Bank, has said that the core issue is with regards to a GST investigation pertaining to programme managers, who have relationship with other banks including Fino Payments Bank. “The Bank and its MD & CEO — Rishi Gupta have nothing to do with the actions of the programme managers,” he said.
On Saturday, the FM, responding to a social media post on the arrest by former Infosys CFO Mohandas Pai, had said she would look into the matter.
Bureaucratic overreach
While GST authorities are probing Gupta’s alleged involvement in the online gaming syndicate, industry members say Gupta’s arrest is an overreach by authorities. Payments Council of India (PCI), the industry association representing digital payments and fintech ecosystem, has written to Union Finance Minister Nirmala Sitharaman raising institutional concerns arising from the arrest of Gupta.
It said regulated financial institutions operate across complex networks of merchants, technology partners, and business correspondents (BCs). The PCI has noted that questions of personal attribution to senior leadership, in matters linked to alleged third-party non-compliance, carry significant implications for governance continuity, depositor and investor confidence, and ongoing regulatory engagements.
Says Vishwas Patel, Chairman, PCI and MD, AvenuesAI, “India’s regulated payments ecosystem has been built on a foundation of institutional trust, governance integrity, and collaborative engagement with regulators. While we have full faith in the enforcement process, we believe it is important for the industry to articulate concerns around proportionality and governance continuity when supervised institutions and their leadership are involved. We have placed these considerations before the Honourable Finance Minister in a spirit of constructive engagement and remain committed to building a compliant, resilient, and inclusive financial ecosystem.”
Business model
Jatinder Handoo, CEO of Unified Fintech Forum (formerly DLAI), says Fino has a vintage of it’s own, starting as a paytech company, pivoting to BC business where they engaged with many banks for enabling financial inclusion, and it recently received the RBI’s in-principle approval to convert to a small finance bank.
“They have enabled financial inclusion on a large scale. We have spoken to many fintech founders and people are concerned. As a responsible industry association, we are all for compliances. The important part is that the fintech industry works on an open platform. It’s not a pure play closed ecosystem like that of a universal bank,” Handoo said.
“Payments bank is fintech. Like other fintechs, PBs work with third party vendors, merchants, and multiple tech partners. If any of their business partners have done wrong, why is the CEO getting arrested in such a manner… Banks have APIs which they share with third party service providers like BCs or merchant points for basic business requirements. We urge the honourable Finance Minister to look into this matter empathically and will take this matter up at appropriate level authorities,” he added.
Published on March 1, 2026