The Board of Directors are pleased to present the 30^th Annual Report on the business and operations of the Fedbank Financial
Services Limited ("Fedfina") together with the Audited Financial Statements for the Financial Year ended 31^st March, 2025 ("year
under review").

FINANCIAL HIGHLIGHTS

The key highlights of the Audited Financial Statements are presented in the table below

Highlights of Performance

The Total revenue of the Company for the financial year ended 31^st March, 2025 has increased to ' 2,07,982 Lakhs as against
' 1,62,300 Lakhs for the previous year ended 31^st March, 2024. Similarly, Net Interest Income (NII) grew by 32% from ' 81,212
Lakhs in FY 2023-24 to ' 1,07,080 Lakhs in FY 2024-25. The revenue increased by 28% on the back of growth of 19% in loan
book during the year. The net profit of the Company decreased by 8% to 22,518 Lakhs for the financial year ended 31^st March,
2025, as against ' 24,470 Lakhs for the financial year ended 31^st March, 2024. The Net worth of Company at the beginning
of the financial year, i.e. 1^st April, 2024, was ' 2,26,083 Lakhs and closing Net worth as on 31^st March, 2025, was ' 2,54,736
Lakhs.

Growth in Business

As of 31^st March, 2025, the AUM increased by 30% compared to FY 2023-24, reaching ' 15,81,154 Lakhs while disbursements
improved by 38% to ' 18,78,732 Lakhs.

Over the past year, ' 1,13,089 Lakhs of the gold loan AUM was through co-lending, and the Company conducted portfolio sell-
down transactions totaling ' 2,12,960 Lakhs. At the end of the year, 25.1% of the AUM was off the books.

CREDIT RATING:

The Company has obtained credit ratings from India Ratings & Research Private Limited, CARE Ratings Limited, CRISIL Limited
and ICRA Limited.

During the financial year 2024-25, there has been upgrade in rating of the Company. The details of all the credit ratings obtained
are given below:

EXPANSION OF NETWORK

The Company has broadened its geographical presence by establishing new branches in different locations, thereby enhancing
accessibility for its customers. With the opening of 75 branches, the branch network stands at 694 branches as on 31^st March,
2025 across 18 states for different products and the break-up is as follows:

BUSINESS OVERVIEW

The Company is well positioned to achieve steady growth,
enhance credit quality and deliver higher returns. Company’s
strong parentage and credit rating enables it to raise equity
and debt on competitive terms. The Company offers a
range of products that have significant potential for growth
in underpenetrated market segments. The Company has a
dedicated workforce of 4,568 employees spread across 18
states and union territories.

There is no change in the nature of business of the
Company for the year under review. Further information on
the business overview and outlook and state of the affairs
of the Company is discussed in detail in the Management
Discussion & Analysis Report.

DIVIDEND

In view of the planned business growth, the Board deems
it proper to preserve the resources of the Company for its
activities and therefore, do not propose any dividend for the
financial year ended 31^st March, 2025.

DIVIDEND DISTRIBUTION POLICY

Since the Company is one of the top 1000 listed Companies
as per market capitalization as on 31^st March, 2025 and
in accordance with the Regulation 43A of Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015, the Dividend Distribution
Policy is available on the website of the Company at https://
www.fedfina.com/corporate-governance/

AMOUNT PROPOSED TO BE TRANSFERRED TO
STATUTORY RESERVES:

The Board of Directors have proposed a transfer of ' 4,504
Lakhs to the Statutory Reserves maintained under Section
45IC of the RBI Act, 1934.

ASSET-LIABILITY MANAGEMENT:

The Company follows a well-defined Asset Liability
Management (ALM) system, driven by Asset Liability
Committee (ALCO), to monitor efficiently and pursue
appropriate policy initiatives.

Liquidity positions are examined regularly across the
specified time buckets to assess and manage mismatches.
The ALM policy and practices of the Company are in line with
the regulatory guidelines, designed to protect against liquidity
as well as interest rate risk challenges and to optimize cost
of funds at all times to fund growth requirements.

The Company maintains a robust Asset Liability Management
(ALM) framework, overseen by the Asset Liability Committee
(ALCO), to ensure prudent monitoring and strategic decision¬
making. This system enables the Company to effectively
manage liquidity and interest rate risks while aligning with
business growth objectives.

Liquidity positions are reviewed regularly across defined
time buckets to identify and address any potential
mismatches. The Company’s ALM policies and practices are
fully compliant with regulatory guidelines and are structured
to mitigate liquidity and interest rate risks. In doing so, the
Company aims to optimize the cost of funds and support
sustained growth.

CHANGES IN CAPITAL STRUCTURE

Authorized Share Capital of the Company:

The Authorized Share Capital of the Company is
' 10,00,00,00,000/- (Rupees One Thousand Crores only)
consisting of 99,00,00,000 (Ninety nine Crores) equity
shares of ' 10/- (Rupees Ten) each and 1,00,00,000 (One
Crore) 0.01 % non-cumulative redeemable preference shares
of face value ' 10 (Rupees Ten) each.

Issued, Subscribed and Paid-up Share Capital of the
Company:

The Issued, Subscribed and Paid up share capital of the
Company changed from ' 3,69,38,68,990/- comprising of
36,93,86,899 Equity shares of face value of ' 10 each to
' 3,72,71,68,540/- comprising of 37,27,16,854 Equity shares
of face value of ' 10 each.

The issued, subscribed and paid up share capital increased
due to allotment of equity shares under the Employee Stock
Option Plan (ESOP) to eligible employees upon exercise
of vested options. During the year under review, 33,29,955
equity shares of face value of ' 10/- each were allotted
pursuant to exercise of stock options by the employees of
the Company under The Fedbank Financial Services Limited
- Employees Stock Option Plan 2018, as amended and
The Fedbank Financial Services Limited- Employees Stock
Options Scheme, 2024, as amended.

ISSUE OF DEBENTURES

During the period under review, the Board of Directors at
their meeting held on 19^th July, 2024, approved the issue of
12,000 (Twelve Thousand) Rated, Listed, Senior, Secured,
Redeemable, Non-Convertible Debentures having a face
value of ' 1,00,000/- (Rupees One Lakh only) each, of the
aggregate nominal value of up to ' 1,20,00,00,000/- (Rupees
One Hundred and Twenty Crores only), in a single series, with
the green shoe option of 8,000 (Eight Thousand) Rated, Listed,
Senior, Secured, Redeemable, Non-Convertible Debentures
of face value of ' 1,00,000/- (Rupees One Lakh only) each,
aggregating up to ' 80,00,00,000/- (Rupees Eighty Crores
only) on private placement basis (ISIN INE007N07058).

MANAGEMENT DISCUSSION AND ANALYSIS ("MDA”)

In compliance with the Regulation 34 of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations,
2015, a separate section on Management Discussion and
Analysis which includes details on the state of affairs of the
Company forms part of this Annual Report.

CORPORATE GOVERNANCE

Corporate Governance has been an integral part of the way
the Company has been doing business since inception. The
Company believes that good Corporate Governance emerges
from the application of the best and sound management
practices and compliance with the laws coupled with
adherence to the highest standards of transparency and
business ethics.

The Company seeks to embed and sustain a culture that
will enable us to achieve our objectives through effective
corporate governance and enhance transparent engagement
with key stakeholders.

A separate report on Corporate Governance setting out the
governance structure, principal activities of the Board and its
Committees and the policies and practices that enable the
Board to fulfil its stewardship responsibilities together with
a Certificate from the Secretarial Auditor of the Company
confirming the compliances with the Corporate Governance
requirements as stipulated under Listing Regulations forms
part of this Annual report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORTING ('BRSR'):

In compliance with Regulation 34(2)(f) of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015,

as applicable, the Business Responsibility and Sustainability
Report (BRSR) of the Company for the financial year ended
31^st March, 2025, forming part of this Annual Report as a
separate report.

The BRSR provides a comprehensive overview of the
Company’s Environmental, Social, and Governance (ESG)
initiatives, disclosures, and performance. It reflects the
Company’s commitment to responsible and sustainable
business practices, aligned with the expectations of its
stakeholders and regulatory requirements.

EMPLOYEES STOCK OPTION SCHEMES:

The Company had formulated the Employees Stock
Option Scheme, 2018 ("ESOS, 2018"), duly approved by
the shareholders of the Company to enable its employees
to participate in the future growth and financial success
of the Company. The Company also intends to use this
ESOS, 2018 to attract and retain talent in the organization.
The Employee Stock Option Scheme was formulated in
accordance with the SEBI guidelines, as amended from time
to time. The eligibility and number of options to be granted
to an employee is determined on the basis of various
parameters such as scale, designation, performance,
grades, period of service, Company’s performance and such
other parameters as may be decided by the Nomination &
Remuneration Committee of the Board from time to time in
its sole discretion.

Further, a new scheme titled 'Fedbank Financial Services
Limited- Employees Stock Option Scheme, 2024' ("ESOS
2024") in accordance with the SEBI regulations for the
benefit of employees was approved by the Shareholders at
the AGM held on September 19, 2024.

During the year under review, 33,29,955 equity shares of face
value of ' 10/- each were allotted on employees pursuant to
exercise of stock options by the employees of the Company
under ESOS 2018 and ESOS 2024.

Other statutory disclosures as required under Regulation
14 of Securities and Exchange Board of India (Share Based
Employee Benefits and Sweat Equity) Regulations, 2021
and Rule 12 of Companies (Share Capital and Debentures)
Rules, 2014 on ESOS are given in website of the Company at
https://fedfina.com/investors-relations/overviews/annual-
report/?page=other-disclosures-reports

NOMINATION AND REMUNERATION POLICY

The Company has formulated Nomination and Remuneration
Policy under the provisions of section 178 of the Act and
SEBI Listing Regulations and the same is uploaded on
the website of the Company at https://www.fedfina.com/
corporate-governance/.

The Company has also formulated Compensation Policy in
accordance with the RBI circular dated 29^th April, 2022.

ALTERATION OF MEMORANDUM AND ARTICLES OF
ASSOCIATION

During the year under review, there were no changes in the
Memorandum of Association of the Company.

The shareholders approved alteration to the Articles of
Association of the Company through Postal Ballot via
remote e-voting conducted on 26^th November, 2024. The
amendment pertained to Article 80, which was modified to
increase the maximum number of Directors on the Board to
twelve.

The existing Memorandum and Articles of Association of the
Company are in compliance with the applicable provisions of
the SEBI (Listing Obligations and Disclosure Requirements)
Regulations.

DIRECTORS AND KEY MANAGERIAL PERSONNEL:

The composition of the Board is in accordance with section
149 of the Companies Act, 2013 and Regulation 17 of the
SEBI LODR with an optimum combination of Executive, Non¬
executive and Independent Directors including two women
director.

As on 31^st March, 2025, the Board of Directors of the
Company comprised of five (5) Independent Directors, one
(1) Non- executive Director, three (3) Nominee Directors
and one (1) executive Director. The Independent Directors,
Nominee Directors are not liable to retire by rotation.

The Company has a Non-executive Chairman who is not
related to the MD & CEO.

Changes in the Directorship

During the year under review, the following changes took

place in the composition of the Board of Directors of the

Company:

• Mr. Ashutosh Khajuria ceased to be a Nominee Director
with effect from 30^th April, 2024, pursuant to a letter
received from The Federal Bank Limited dated 28^th
March, 2024.

• Further, Mr. Harsh Dugar was appointed as Nominee
Director with effect from 5^th May, 2024 who was
nominated by The Federal Bank Limited.

• Based on the recommendation of Nomination
and Remuneration Committee("NRC") and Board,
the shareholders of the Company have approved
the appointment of Mr. Sunil Satyapal Gulati (DIN:
00016990) and Mr. Ramesh Sundararajan (DIN:
10500779) as Independent Directors by means of a
special resolution passed through Postal Ballot on
6^th June, 2024. Additionally, the continuation of Mr.
Maninder Singh Juneja (DIN: 02680016) as Nominee
Director nominated by True North Fund VI LLP and
the appointment of Mr. Harsh Dugar (DIN: 00832748)
as Nominee Director nominated by The Federal Bank
Limited were also approved.

• On the recommendation of the Nomination and
Remuneration Committee, the Board of Directors
appointed Mrs. Sonal Dave (DIN: 00017710), Mrs. Mona
Bhide (DIN: 05203026) and Mr. Muralidharan Rajamani
(Din: 01690363) as an Additional Director in capacity
of Independent Director effective from 24^th September,
2024, 29^th November, 2024 and 24^th January, 2025
respectively. Subsequently, the shareholders of the
Company approved the appointment of Mrs. Sonal Dave
(DIN: 00017710), Mrs. Mona Bhide (DIN: 05203026) and
Mr. Muralidharan Rajamani as Independent Director by
passing special resolutions vide Postal Ballots through
remote e-voting on 26^th November, 2024, 27^th January,
2025 and 16^th April, 2025 respectively. In the opinion of
the Board, each of the Independent Directors are person
of integrity and possesses expertise and competent
experience and proficiency to serve the Company as an
Independent director. Hence they were considered for
appointment/ reappointment.

• Mr. Balakrishnan ceased to hold office as an
Independent Director with effect from 27^th September,
2024, upon completion of his term. He also ceased to
be the Chairman of the Board effective 24^th September,
2024. Mr. Shyam Srinivasan was appointed as a
Chairman of the Board effective 25^th September, 2024
for a term of 3 years.

• Mr. Anil Kothuri resigned from the position of Managing
Director and CEO of the Company with effect from
8^th November, 2024 for pursuing other opportunities.
The Director has confirmed that there are no material
reasons apart from the reasons given in his resignation
letter.

• Based on the recommendation of the Nomination
and Remuneration Committee, the Board of Directors
have appointed Mr. Parvez Mulla (DIN: 08026994) as
Managing Director & CEO for a term of three years with
effect from 11^th November, 2024 till 10^th November,
2027. The shareholders have approved the same on
27^th January, 2025 vide Postal Ballot through remote
e-voting.

• Further, Mr. Krishnan Venkat Subramanian was
appointed as Nominee Director with effect from 30^th
November, 2024 who was nominated by The Federal
Bank Limited.

• Mrs. Gauri Rushabh Shah ceased to serve as an
Independent Director effective 12^th February, 2025,
upon completion of her term.

• Mr. Shyam Srinivasan (DIN: 02274773), is liable to retire
by rotation and being eligible, offers himself for re¬
appointment at the ensuing Annual General Meeting.
Being eligible, Mr. Shyam Srinivasan have offered
himself for re-appointment as Director. Brief particulars
of Mr. Shyam Srinivasan have been provided in the
notice of the 30^th AGM of the Company.

Apart from the aforesaid, there were no other changes in the
composition of the Board of Directors and Key Managerial
Personnel(KMP) of the Company during the year under
review.

Changes in Key Managerial Personnel (KMP)

• Mr. Rajaraman Sundaresan ceased to be the Company
Secretary & Compliance Officer and KMP effective 31^st
July, 2025 due to completion of his term.

• Upon recommendation of Nomination and
Remuneration Committee, the Board at its meeting
held on 28^th July, 2025 appointed Mr. Parthasarathy
Iyengar as Company Secretary & Compliance Officer
and KMP with effect from 1^st August, 2025.

BOARD MEETINGS HELD DURING THE YEAR

During the year under review, your Board of Directors met 14
times and the gap between any two meetings did not exceed
one hundred and twenty days.

The dates on which the meetings were held are 25^th April,
2024, 29^th April, 2024, 8^th May, 2024, 18^th June, 2024, 16^th
July, 2024, 19^th July 2024, 9^th August, 2024, 24^th September,
2024, 27^th September, 2024, 22^nd October, 2024, 23^rd October,
2024, 29^th November, 2024, 24^th January, 2025 and 27^th
March, 2025.

Details of the meetings and attendance thereat forms part
of the Report on Corporate Governance.

DECLARATION FROM INDEPENDENT DIRECTORS

There are five (5) Independent Directors on the Board of the
Company as on 31^st March, 2025. The Independent Directors
have submitted declarations that they continue to fulfil the
criteria of independence laid down under Section 149 of
the Companies Act, 2013, regulation 16 of SEBI LODR and
complied with the Code for Independent Directors prescribed
in Schedule IV to the Act.

The Independent Directors have confirmed that they are not
aware of any circumstance or situation, which exists or may
be reasonably anticipated, that could impair or impact their
ability to discharge their duties with an objective independent
judgment and without any external influence.

In the opinion of the Board, the Independent Directors are
eminent persons and possess requisite qualifications,
integrity, expertise and experience in the relevant functional
areas.

All the Independent Directors have a valid registration in
the Independent Director's databank of the Indian Institute
of Corporate Affairs as required under Rule 6(1) of the
Companies (Appointment and Qualification of Director) Fifth
Amendment Rules, 2019.

BOARD EVALUATION

The Company has defined a manner of evaluation as per
the provisions of the Act and SEBI LODR and formulated
a method for the evaluation of the performance of the
Board, its Committees and individual Directors. The annual
evaluation of the performance of the individual Directors
(including the Chairman of the Board) were conducted on
parameters such as level of engagement and contribution
and independence of judgment - thereby safeguarding the
interests of the Company.

The performance evaluation of the Independent Directors
were carried out by the entire Board, excluding the director
being evaluated. The performance evaluation of the
Chairman, the Non-Independent Directors and Board as a

whole were carried out by the Independent Directors. The
Board also carried out annual performance evaluation of the
working of each of its Board constituted Committees.

All the Directors have confirmed that they satisfy the 'fit
and proper’ criteria in terms of the provisions of Master
Direction - Reserve Bank of India (Non-Banking Financial
Company - Scale Based Regulation) Directions, 2023 and
that they are not disqualified from being appointed/re-
appointed/continuing as Director in terms of Section 164(1)
and (2) of the Act. None of the Directors of the Company are
disqualified and/or debarred as per the applicable provisions
of the Act and the Securities and Exchange Board of India.

The Directors have expressed their satisfaction with the
evaluation process. The Board opined that the Board
Committees’ composition, structure, processes and
working procedures are well laid down and that the Board
Committees members have adequate expertise drawn from
diverse functions, industries and business and bring specific
competencies relevant to the Company’s business and
operations.

All Board members and senior management personnel have
affirmed compliance with the Company’s code of conduct
for the FY 2024-25.

COMMITTEES

Details on composition of various Committees of the
Board, terms of reference and number of meetings of the
Committees held are given in the Corporate Governance
Report which forms part of the Annual Report.

COMPLIANCE WITH THE SECRETARIAL STANDARDS

During the year under review, the Company has complied
with the applicable mandatory secretarial standards issued
by the Institute of Company Secretaries of India.

THE CHANGE IN THE NATURE OF BUSINESS, IF ANY

There was no change in the nature of business of the
Company during the financial year ended 31^st March, 2025.

During the year under review, the Company has received
the Corporate Agent (Composite) license dated 10^th June,
2024 issued by Insurance Regulatory and Development
Authority of India ("IRDAI") for soliciting life, general and
health insurance ("Composite") as Corporate Agent under
Insurance Regulatory and Development Authority of India
(Registration of Corporate Agents) Regulations, 2015.

HUMAN RESOURCE - TALENT POOL - PERFORMANCE
MANAGEMENT:

The Company has been always prided itself in being a
people first organization. Our evolved digitized onboarding

assisted us in seamless joining for new joiners in different
geographies where we have expanded our presence. Our
employee strength has grown by 4.8% as compared to
the previous year in line with our expansion plans. Our
concentration revolves around continuous growth, culture
and a learning experience. To nurture this talent, the
Company have implemented practices focused on skill
enhancement through regular training sessions, leadership
development programmes, and a transparent performance
management system. Additionally, it is given priority on
healthy work-life balance for our employees, believing it
enhances their productivity and motivation.

In continuation to our endeavor to promote Gender Diversity
at workplace, the Company continue the Restart with
Fedfina initiative to help women with career breaks to restart
their career.

Women Leadership Program was launched where the
women leaders participating in the program were from
different industries, providing them an additional dimension
towards their learning. The objective of the program is to
equip our women employees in Manager and above grades
to grow further as leaders. They went through a 3 months
long transformational journey focused towards developing
leadership mindset, strategic thinking and building an
executive presence.

Further, Professional development policy is designed to
empower our workforce with the skills and knowledge
necessary for career advancement. Additionally, the well¬
being of our employees through regular health checkups
is prioritized, ensuring their physical and mental health is
diligently monitored.

Online recruitment module and in-house BGV.

This year we initiated in-house recruitment module with
sole purpose to automate the recruitment process, making
it more efficient and structured for the organization. It aims
to enhance to minimize the TAT and enhance recruitment
experience for both interviewer and interviewee by providing
a centralized platform.

We have also initiated an internal BGV to ensure that an
applicant’s background is thoroughly evaluated, that there is
no criminal history, and that the individual is the best fit for
the Company. This process decreases BGV’s costs, lessens
the Company’s dependency on outside vendors, lowers risks,
prevents fraud, and ensures that the business complies with
legal requirements.

Onboarding Apprentice Program.

This year we have on boarded 300 plus apprentice under
National Apprenticeship Promotion Scheme (NAPS) by the

Government with objective develop a skilled workforce,
enhance employability, and foster a pipeline of talent for
industries. They focus on providing practical, on-the-job
training alongside theoretical learning, leading to nationally
recognized qualifications and increased career opportunities
for apprentices.

PARTICULARS OF EMPLOYEES

Disclosures relating to remuneration and other details as
required in terms of the provisions of Section 197(12) of
the Act read with Rule 5(1) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014 are
given in Annexure I which forms part of this Report.

Further, in accordance with the provisions of Sections 197(12)
& 136(1) of the Act read with the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014,
the list pertaining to the names and other particulars of
employees drawing remuneration in excess of the limits set
out in the aforesaid Rules, is kept open for inspection during
working hours at the Registered Office of the Company and
the Report & Accounts as set out therein are being sent
to all the Members of the Company. Any Member, who is
interested in obtaining these, may write to the Company
Secretary at the Registered Office of the Company.

CAPITAL ADEQUACY

The Company’s capital adequacy ratio stood at 21.92% as
on 31^st March, 2025 which is well above the threshold limit of
15% prescribed by the Reserve Bank of India. Tier-I Capital
ratio alone stood at a healthy 18.92%.

PUBLIC DEPOSITS

The Company is a Non- Deposit taking Systematically
Important NBFC and has not accepted public deposits
falling under purview of provisions of section 73 of the Act
during the year. Hence the requirement of furnishing the
details in terms of Chapter V of the Companies Act, 2013 is
not applicable.

RISK MANAGEMENT POLICY

Risk management forms an integral part of our business.
The Company has a Board approved Risk Management
Policy that lays down the overall framework for identifying,
assessing, measuring and monitoring various elements
of risk involved in the businesses and for formulation of
procedures and systems for mitigating such risks. The main
objective of this policy is to ensure sustainable and prudent
business growth.

The Risk Management Committee, a dedicated board-level
committee, plays a pivotal role in continuously reviewing,
approving, and refining our risk management policies and

procedures and governing framework for each type of
risk on a regular periodicity. The Committee monitors the
compliance of risk parameters and aggregate exposures
within the defined limits.

Directors have basis recommendation of Risk Management
Committee adopted ICAAP Policy and Framework with
the objective of ensuring availability of adequate capital to
support all risks in business as also enable effective risk
management system in the Company.

The Company continues to invest in people, processes,
training and technology; so as to strengthen its overall Risk
Management Framework.

AUDITORS:

1. STATUTORY AUDITORS & THEIR REPORT

M/s KKC & Associates LLP, Chartered Accountants
(Firm Registration No. 105146W/W- W100621) were
appointed as Statutory Auditors of the Company at the
Twenty ninth Annual General Meeting (AGM) held on
19^th September, 2024 for a tenure of three years till the
conclusion of the Thirty second Annual General Meeting
to be held for the year 2027.The Audit Report submitted
by M/s KKC & Associates LLP Chartered Accountants,
for the financial year 2024-25 does not contain any
qualification, reservation or adverse remark.

2. SECRETARIAL AUDITORS & THEIR REPORT

M/s. DKJ & Associates Company Secretaries LLP
were appointed as the Secretarial Auditors to conduct
the Secretarial Audit for the financial year ended 31^st
March, 2025. The Report of the secretarial auditors
in the prescribed Form MR-3 is set out in Annexure II
to this Report. The Secretarial Audit Report does not
contain any qualifications, reservation or adverse
remark except to the extent stated below:

BSE Limited (BSE) vide their email dated 1^st July,
2024 imposed a fine of ' 10,000/- (excluding GST) for
delayed compliance with Regulation 60 (2) of Securities
and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015 for
delay of one day in giving notice of Record Date for
the payment of principal and interest of Debentures.
Further, the Company has made waiver application in
this behalf with BSE Limited and order in this behalf is
awaited.

Management Response

The Company intimated the record date with a delay
of one day to BSE which was due to the techinal glitch
on the BSE portal. The Company has applied for waiver
letter to BSE for the same and response from BSE is
awaited.

The observations made in the Secretarial Auditors report
are self-explanatory and therefore do not call for any further
comments.

FRAUD REPORTING

Pursuant to the Board approved 'Fraud Risk Management
and Fraud Investigation Policy’ of the Company, information
relating to all frauds are reported to the Board on quarterly
basis.

During the year under review, the frauds detected and the
same has been timely reported to the Audit Committee/
Board as well as to the Reserve Bank of India (RBI) amounting
to ' 509.47 Lakhs.

Pursuant to the section 143(2) of the Companies Act, 2013,
no frauds were reported by the Auditors of the Company to
the Audit Committee during the year under review.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company believes that strong internal control system
and processes play a critical role in the health of the
Company. The Company has instituted adequate internal
control systems commensurate with the nature of its
business & size of operations. The Company’s well-defined
organizational structure, documented policy guidelines,
defined authority matrix and internal controls ensure
efficiency of operations, compliance with internal policies
and applicable laws and regulations as well as protection
of resources. The internal control system is supplemented
by internal audits, regular reviews by the management and
standard policies and guidelines which ensure reliability
of financial and all other records. The Company’s Internal
Audit department performed regular reviews of business
processes to assess the effectiveness & adequacy of the
internal control systems, compliance with policies and
procedures. The Company upholds strong governance
with a risk-based internal audit framework to identify and
mitigate operational risks efficiently

All significant audit observations of the internal auditors and
follow up actions were duly reported to the Audit Committee.

INTERNAL FINANCIAL CONTROLS AND THEIR
ADEQUACY

Internal Financial Controls laid down by the Company is
a systematic set of controls and procedures to ensure
orderly and efficient conduct of its business including
adherence to the Company’s policies, safeguarding of
its assets, prevention and detection of frauds and errors,
accuracy and completeness of the accounting records and
timely preparation of reliable financial information. Internal
financial controls not only require the system to be designed
effectively but also to be tested for operating effectiveness
periodically.

During the year under review, the Company had engaged a firm
of Chartered Accountants to evaluate the internal financial
control framework and to test its operating effectiveness.
Based on the testing conducted by the aforesaid firm,
the Board is of the view that the Company has laid down
adequate internal financial controls commensurate with the
nature and size of its business operations and these controls
are adequate and operating effectively and no material
weaknesses have been observed.

RELATED PARTY TRANSACTIONS

All the related party transactions that were entered into
during the financial year were on arm’s length basis and in
the ordinary course of business.

The related party transactions were placed before the Audit
Committee on quarterly basis. Transactions with related
parties, as per the requirements of Accounting Standards,
are disclosed in the notes to accounts annexed to the
financial statements.

Particulars of contracts or arrangements with related parties
referred to in sub-section (1) of section 188 in the prescribed
form are provided in the form AOC-2 in accordance with the
rule 8 (2) of the Companies (Accounts), 2014 Rules. Form
AOC-2 is set out in Annexure III to this report.

MATERIAL CHANGES AND COMMITMENTS AFFECTING
THE FINANCIAL POSITION OF THE COMPANY THAT
OCCURRED BETWEEN THE END OF THE FINANCIAL
YEAR TO WHICH THIS FINANCIAL STATEMENT RELATE
TILL THE DATE OF THIS REPORT:

No material changes and commitments affecting the
financial position of the Company have occurred between
the Financial year ended 31^st March, 2025 till the date of this
report.

PARTICULARS OF LOANS, GUARANTEES AND
INVESTMENTS UNDER SECTION 186 OF THE
COMPANIES ACT, 2013

The Company, being a NBFC registered with RBI, is exempted
from complying with the provisions of section 186 of the
Act related to loans made, guarantees given and securities
provided. However, the details of investments made by the
Company pursuant to the provisions of Section 186 (4) of
the Act are given in Note 9 to the Financial Statements.

DISCLOSURES UNDER SEXUAL HARASSMENT OF
WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
& REDRESSAL) ACT 2013

The Company has Prevention of sexual harassment (POSH)
policy which is in line with the requirements of The Sexual
Harassment of Women at the Workplace (Prevention,
Prohibition and Redressal) Act, 2013. The Company is in
compliance with the constitution of Internal Complaints
Committee (ICC) to redress complaints received regarding
sexual harassment. All employees (permanent, contractual,
temporary, trainees) are covered under this policy.

The following is a summary of sexual harassment complaints
received and dealt with during the year 2024-2025:

• No. of complaints received: 1

• No. of complaints disposed of: 1

• No of cases pending for more than ninety 90 days: 0

DISCLOSURES UNDER MATERNITY BENEFITS ACT
1961

The Company affirms its compliance with the provisions
of the Maternity Benefit Act, 1961, as amended. We remain
committed to supporting our women employees and
ensuring a workplace environment that upholds their rights
and well-being. The Company has extended all applicable
benefits under the Act, including paid maternity leave,

medical bonuses, nursing breaks, and, where required,
creche facilities

CORPORATE SOCIAL RESPONSIBILTY

The Company has a Corporate Social Responsibilty (CSR)
Committtee in place in accordance with section 135 of the
Act. The CSR Committee has formulated and recommended
to the Board, a Corporate Social Responsibility Policy ("CSR
Policy") indicating the activities to be undertaken by the
Company, which has been approved by the Board. The CSR
Policy is available on the Company’s website at https://www.
fedfina.com/csr/. The Company has spent ' 4,73,11,428/-
on CSR activities during the year under review.

The required disclosure as per Rule 8 of Companies
(Corporate Social Responsibility Policy) Rules 2014 is
attached as Annexure IV to this report.

RBI GUIDELINES:

The Reserve Bank of India (RBI) granted the Certificate
of Registration to the Company in August 2010 vide
Registration No. N-16.00187, to commence the business
of a non-banking financial institution without accepting
public deposits. The Company is categorized as NBFC in
Middle layer pursuant to Master Direction - Reserve Bank
of India (Non-Banking Financial Company - Scale Based
Regulation) Directions, 2023 and has complied with and
continues to comply with all the applicable regulations and
directions of the RBI.

ANNUAL RETURN:

Pursuant to section 92 (!) of the Companies Act 2013, the
Annual Return for the year 2024-25 is placed on the website
of the Company fhttps://www.fedfina.com)

PARTICULARS OF ENERGY CONSERVATION,
TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
INFLOW/OUTFLOW, ETC.

The requirements of disclosure with regard to Conservation
of Energy and technology absorption in terms of Section
134 of the Companies Act, 2013, read with the Companies
(Accounts) Rules 2014, are not applicable to the Company
as it does not engage in any manufacturing facility.

The Company continues to invest in cutting edge
technology, which has resulted in automation of the loan
lifecycle process along with building a scalable and modular
application architecture. Customer centricity is a key focus
area in the Company’s digital initiatives. Our customers also
benefit from the doorstep model of loan disbursal. These
investments along with leveraged national digital enablers
like IndiaStack, Aadhaar eKYC, along policy momentum from
RBI and the Government of India helps us to drive growth

We continue to focus on data protection, infrastructure
upgradation and also ensure complete adherence to
RBI policies. Investments have also been made in next
generation security and network monitoring tools.

The Company had availed total External Commercial
Borrowing (ECBs) of US$ 30 Mn for financing prospective
borrower as per the ECB guidelines issued by Reserve
Bank of India ("RBI") from time to time. The borrowing has
a maturity of three years. In terms of the RBI guidelines,
borrowings have been swapped into rupees and fully hedged
for the entire maturity by way of cross currency swaps. The
Company has not borrowed any Foreign Currency (USD)
denominated Term Loan other than rollover of existing
foreign currency borrowing facility (March 31 2024, ' Nil).
Such borrowings are currently carried at ' 1 1,250 Lakhs as
at 31^st March, 2025 (March 31 2024: ' 16,257 Lakhs).

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Companies Act, 2013, the
Directors confirm that:

I. in the preparation of the annual accounts, the applicable
accounting standards had been followed along with
proper explanation relating to material departures;

II. such accounting policies have been selected and
applied consistently and made judgments and
estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the

Company as at 31^st March, 2025 and the profits of the
Company for the financial year ended on that date;

III. proper and sufficient care had been taken for the
maintenance of adequate accounting records
in accordance with the provisions of the Act for
safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;

IV the annual accounts have been prepared on going
concern basis; and

V. proper systems had been devised to ensure compliance
with the provisions of all applicable laws and that such
systems were adequate and operating effectively.

VI. internal financial controls to be followed by the company
had been laid down and that such internal financial
controls were adequate and operating effectively.

OTHER DISCLOSURES

In terms of applicable provisions of the Act, the Company

discloses that during the year under review:

i. The Company has not issued any shares with
differential rights and hence no information as per
provisions of Section 43(a)(ii) of the Act read with Rule
4(4) of the Companies (Share Capital and Debenture)
Rules, 2014 is furnished.

ii. The Company has not issued any sweat equity shares
and hence disclosure as per provisions of Section 54(1)
(d) of the Act read with Rule 8(13) of the Companies
(Share Capital and Debenture) Rules, 2014 is not
provided.

iii. There were no instances of non exercising of voting
rights in respect of shares purchased directly by
employees under a scheme hence no information
pursuant to Section 67(3) of the Act read with Rule
16(4) of Companies (Share Capital and Debentures)
Rules, 2014 is furnished.

iv. There are no significant and material orders passed by
the regulators or courts or tribunals that would impact
the going concern status of the Company and its future
operations.

v. The Company has not made any application nor any
proceedings are pending under the Insolvency and
Bankruptcy Code, 2016.

vi. There were no instances of one-time settlement for any
loans taken from the Banks or Financial Institutions.

vii. There were no amounts required to be transferred
to Investor Education and Protection Fund (IEPF)
pursuant to section 124 and 125 of the Companies Act,
2013 read with Rules made thereunder.

ix. The Company being, a Non-Banking Financial Company
is not required to maintain cost records as prescribed
under section 148(1) of the Act.

x. The Company does not have any subsidiary, joint
venture or associate Company.

xi. The Company has shifted its registered office from
one locality to another within the same city i.e. from
'Kanakia Wall Street, A Wing, 5^th Floor, Unit 511, Andheri
Kurla Road, Chakala, Andheri East, Mumbai- 400093,
Maharashtra’ to 'Unit no.: 1101, 11^th Floor, Cignus,
Plot No. 71A, Powai, Paspoli, Mumbai - 400 087,
Maharashtra’ effective from 25^th April, 2024.

CAUTIONARY NOTE

Certain statements in this Report may be forward-looking

and are stated as may be required by applicable laws and

regulations. Actual results may vary from those expressed or
implied, depending upon economic conditions, Government
policies and other incidental/related factors.

ACKNOWLEDGEMENT

The Board of Directors place on record sincere gratitude to
all employees for their unwavering dedication, resilience,
and collaborative spirit. With such a strong foundation
and shared vision, we are confident in our ability to drive
continued success in the years ahead.

The Directors would also like to place on record, their
gratitude for the cooperation and guidance received from all
the statutory bodies, especially the RBI. The Directors also
thank the shareholders, clients, vendors, investors, banks
and other stakeholders in placing their faith in the Company
and contributing to its growth.