Rishi Gupta, the Managing Director and CEO of Fino Payments Bank, remains in judicial custody following the Telangana High Court’s dismissal of his bail plea. The court’s decision comes amidst serious allegations of tax evasion amounting to approximately ₹840 Crores.
Gupta’s arrest, which took place in late February 2026, is linked to accusations of masterminding transactions involving shell entities, with the Directorate General of GST Intelligence leading the investigation. The probe has revealed an organized syndicate allegedly routing funds tied to illegal online gaming platforms.
In his writ petition, Gupta sought to have his arrest declared “arbitrary, illegal, highhanded and violative of Articles 14, 19, 21 and 22 of the Constitution of India.” However, the court has upheld the legality of his detention, leaving Gupta’s legal team to explore further options.
In the wake of Gupta’s arrest, Fino Payments Bank has appointed Ketan Merchant as interim CEO for a maximum of four months. Despite the turmoil, the bank’s operations have reportedly remained stable and uninterrupted, with the institution continuing to engage constructively with regulators and stakeholders.
Fino Payments Bank, which received in-principle approval from the Reserve Bank of India to transition into a small finance bank in December 2025, has seen its shares decline nearly 28% since Gupta’s arrest. The stock price fell to a 52-week low of ₹135.2, closing at ₹139.50 after the news broke.
Merchant has publicly stated that the bank and Gupta have no involvement in the actions of the program managers implicated in the ongoing investigation. This statement aims to reassure stakeholders of the bank’s integrity amidst the unfolding legal challenges.
The investigation’s scope is extensive, with estimates suggesting that around ₹3000 Crores in transactions have been routed through shell entities, raising significant concerns about compliance and governance within the financial sector.
As the situation develops, observers are keenly watching for further legal maneuvers from Gupta’s defense team and any additional statements from Fino Payments Bank regarding its operational stability and regulatory compliance.
Details remain unconfirmed regarding the full extent of the allegations and their potential impact on Fino Payments Bank’s future operations.
