The board withdrew a notice seeking shareholder approval for Gupta’s re-appointment, according to a stock exchange filing late Thursday night.
The bank is conducting a postal ballot on payment of remuneration to Gupta as well as his reappointment. The voting started on February 28 and is scheduled to conclude on March 29. The agenda related to Gupta’s appointment now stands withdrawn for the time being.
The board said it took the decision after “thoughtful considerations” and “in the interest of due process and sound corporate governance practices“.
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However, it clarified that the candidature of Gupta for his extension as MD & CEO is “in no manner withdrawn, abandoned or prejudiced by this action”.
The board said that his reappointment would now be subject to a decision by the Reserve Bank of India.”The said agenda item shall be submitted for the consideration of the members to seek their approval at an appropriate time, subject to compliance of the provisions of the Companies Act, 2013, Sebi listing regulations and RBI guidelines issued in this regard and re-assessment of the fit and proper status of Mr Rishi Gupta by the NRC (nomination and remuneration committee) and board and after a view is taken by the RBI in this regard,” the bank said.
Gupta, a founding member of Fino PayTech that later became Fino Payments Bank, was arrested on February 27 in a goods and services tax-related investigation. He was granted bail by a Hyderabad court on Thursday.
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The board had proposed extending Gupta’s tenure in January, with the re-appointment due to take effect from May 2.
The latest development comes at a crucial time for Fino Payments Bank, which is seeking to transition into a small finance bank after receiving an in-principle licence from the RBI on December 5, 2025.
Following Gupta’s arrest, the bank appointed chief financial officer Ketan Merchant as interim head.