Rishi Gupta, the Managing Director and CEO of Fino Payments Bank, is facing significant legal challenges as the Telangana High Court has dismissed his writ petition seeking bail. Gupta’s arrest stems from allegations of masterminding a tax evasion scheme involving approximately ₹840 Crores, linked to transactions with shell entities.
Gupta has been in judicial custody since late February 2026, and his plea aimed to declare his arrest as arbitrary and unlawful, citing violations of constitutional rights. In his words, he sought to “declare the arrest of the Petitioner… to be arbitrary, illegal, highhanded and violative of Articles 14, 19, 21 and 22 of the Constitution of India.”
The investigation, conducted by the Directorate General of GST Intelligence, has revealed a complex web of transactions allegedly routed through shell companies, with estimates suggesting that around ₹2800 Crores may be involved in tax evasion linked to illegal online gaming platforms.
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 remain stable, and it continues to add around 10,000 CASA accounts daily. Merchant stated, “The Bank and its MD & CEO Rishi Gupta have nothing to do with the actions of the programme managers,” emphasizing the institution’s commitment to regulatory compliance.
Since Gupta’s arrest, Fino Payments Bank’s shares have plummeted nearly 28%, closing at ₹139.50, down from a 52-week high of ₹135.2. The bank has assured stakeholders that it will engage constructively with regulators and make appropriate disclosures as required by law.
Observers note that this case is part of a broader investigation into an organized syndicate involved in illegal financial activities, raising concerns about the implications for the banking sector and regulatory oversight in India.
As the situation unfolds, the legal proceedings against Gupta will likely attract significant attention, with many awaiting further developments in this high-stakes case. Details remain unconfirmed regarding the potential impact on Fino Payments Bank’s future operations and its transition into a small finance bank, which received in-principle approval from the Reserve Bank of India in December 2025.
