It is our pleasure to present the 34^th Annual Report together with the Audited Standalone and
Consolidated Financial Statements for the Financial Year ended March 31, 2026. This report, read
with Corporate Governance Report and Management Discussion & Analysis Report includes macro¬
economic scenario, governance philosophy, financial performance of the Company, business
overview, opportunities and threats and various initiatives taken by the Company.

Company Overview

Paisalo Digital Limited, is a Public Limited Company incorporated on March 5, 1992 under the
Companies Act, 1956 and has its registered office at Delhi, India. It is registered as a Non-Deposit
taking Non-Banking Financial Company vide the Reserve Bank of India ('RBI') registration number
B-14.02997 and classified as a Non-Deposit Taking Middle Layer NBFC.

The Company launched its Initial Public Offering of equity share and was listed on UP Stock Exchange;
Ahmedabad Stock Exchange and Delhi Stock Exchange in the year 1996. Subsequently, shares of the
Company got listed on BSE Limited ("BSE") in the year 2007 and National Stock Exchange of India
Limited ("NSE") in the year 2009. Currently equity shares are listed on BSE and NSE.

Financial Highlights

The Standalone financial performance of the Company for the Financial Year 2025-26 is summarized
below:

Results of Operations and State of Company's Affairs

Revenue from operations for the year ended March 31, 2026 has increased by 24.85% at ^9174.06 Million over the
corresponding previous year. The Net Profit of your Company for the financial year ended March 31, 2026 stood at ^2,346.89
Million as against the Net Profit of ^1,976.87 Million for the financial year ended March 31, 2025. Accordingly, the Net Profit
for the financial year ended March 31, 2026 reflects a growth of 18.72 % over the corresponding Profit for the financial year
ended March 31, 2025.

Transfer to Reserves

Under Section 45IC of the Reserve Bank of India Act, 1934, Non-Banking Financial Companies (NBFC) are required to transfer
a sum not less than 20% of its net profits every year to Reserve Fund before declaration of any dividend. Accordingly, the
Company has transferred ^469.38 Million (previous year ^395.37 Million) to Statutory Reserve. Further, ^1700 Million has
been transferred to General Reserve for FY 26.

Pursuant to provisions of the Companies Act, 2013 read with relevant rules thereunder, the Company, being a NBFC, is
exempt from creating debenture redemption reserve in respect of privately placed debentures including the requirement
to invest up to 15% of the amount of debentures maturing during the next financial year. However, the Company maintains
a sufficient liquidity buffer to fulfil its obligations arising out of debentures.

Subsidiary Company

The Company has only one Wholly Owned Subsidiary viz. Nupur Finvest Private Limited, a registered Non-Deposit Taking
Non-Banking Finance Company. Nupur Finvest Private Limited is engaged in finance activities. At the year ended March 31,
2026, the net worth of the Subsidiary Company stood at ^622.96 Million. During the reporting period, the subsidiary reported
income of ^316.29 Million and Profit Before Tax (PBT) and Profit After Tax (PAT) at ^33.64 Million and ^25.17 Million respectively.

During FY 26, no new Subsidiary was incorporated/acquired. The Company neither has any Associate Company nor has
entered into a Joint Venture with any other Company.

The Financial Statement of Subsidiary Company is also available in a downloadable format under the Investor Section on
the Company's website at www.paisalo.in.

Pursuant to the provisions of Regulation 16 of SEBI (LODR) Regulations, 2015, the Company has a Policy for Determining
Material Subsidiary which is available at Company's website athttps://www.paisalo.in/pdf/corporate governance/policy/
Policy for determining Material Subsidiary1.pdf.

Consolidated Financial Statements

In compliance with the applicable provisions of Companies Act, 2013 including applicable Accounting Standards on
Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the financial
year ended March 31, 2026.

Consolidated financial performance of the Company for the financial year ended March 31, 2026 is summarized below:

Review of Operations

Paisalo provides three key financial services: (i) small income generation loans such as Umeed and Pragati loans extended
to livelihood-oriented borrower categories such as food/tea stalls, street vendors, tailors, poultry, etc. ("Small Income
Generation Loans"); (ii) entrepreneurial loans to MSMEs and business loans such as Udaan loans extended to retailers, small

traders and manufacturers ("MSME/Business Loans"), and (iii) financial services provided under business correspondent
agreements entered into by our Company with partner banks, such as, SBI and Bank of India, which include services such
as account opening, savings bank deposits, term deposits, remittances, cash deposit and withdrawal, pension products,
micro insurance, enrolment in government sponsored social security schemes, small value credit, and recovery.

Your Company also undertakes partnership-based lending ("PBL") or co-lending, which are collaborative arrangements
for sourcing, servicing, and recovery of loans, with risk and reward sharing on an 80:20 participation ratio. In this, the
Company serves as the originator of loans, thereby retaining a smaller share (usually 20%) of the Company's loan book,
leveraging Company's larger partners' balance sheets, who take a larger proportion (around 80%) of the loans on their
books, expanding their customer base with less acquisition costs. The ticket size in these co-lending arrangements range
between ^10,000 and ^5,00,000.

During the year under review, the Company added approx. 7 million customers to its franchise. The total customer franchise
stood at approx. 16 million as of March 31, 2026.

The Company's total geographic footprint as of March 31, 2026 comprised 5299 touchpoints, including 422 branches, 3,381
distribution points, and 1,496 Customer Service Points (CSPs) across 22 states.

During the year under review, total disbursements reached ^42,620.00 million, and the Company posted an 18.72% increase
in net profit after tax in FY26 compared to FY25.

Gross NPA and Net NPA stood at 0.76% and 0.61%, respectively, during the period under review.

The Company delivered on its FY 26 objectives relating to customer franchise expansion, geographic reach, operating
efficiency (Opex to NTI), GNPA, and NNPA. Credit costs remained elevated but stayed within the Company's long-term
guidance of below 2%. Significant credit-related corrective actions were undertaken during FY26, and the Company remains
optimistic about their positive impact on profitability in FY27. The Company also witnessed a marginal compression of 2
basis points in Net Interest Margin (NIM).

Key Ratio

The Key Ratio (standalone) for the financial year ended March 31, 2026:

Net Worth and Capital Risk Adequacy Ratio (CRAR)

The Net Worth of the Company (Standalone) increased to ^17,327.91 Million as on March 31, 2026 from ^15,257.07 Million as
on March 31, 2025.

The Capital Risk Adequacy Ratio (CRAR) stood at 35.85% as on March 31, 2026 as against 39.16% as on March 31, 2025, which
is much above the requirement as stipulated by Reserve Bank of India.

Awards and Recognition

For the period under review, the Company was awarded

Issue of Equity Shares

During FY 26, 74,03,585 equity shares, having a face value of ?1/- (Rupee 1) each, at a premium of ^44.74 per share, were
allotted on September 17, 2025, upon conversion of 4000 Foreign Currency Convertible Bonds of US $4 Million.

Share Capital

The Authorized Share Capital of the Company stood at ^1,80,00,00,000.00 consisting of 1,75,00,00,000 Equity Shares of ?1/-
(Rupee One only) each and 50,00,000 Preference Shares of ?10/- (Rupees Ten only) each. Consequent to allotments made
during the year, the Issued Share Capital, Subscribed Share Capital and Paid-up Share Capital of the Company has been
increased and accordingly as on March 31, 2026, the same stood as under:

Debt Securities/lnstruments and Utilization of Fund Raised from it

During the year under review, Company has raised ^3,350 Million by issuing Listed Non-Convertible Debentures on private
placement basis. For Secured Debentures, the prescribed asset cover is maintained at all times.

During the year, the Company has also raised funds for short-term purposes through listed Commercial Papers.

The Fund so raised during the year from debt securities/instruments had been utilized for the same purpose as mentioned
in the issue/ offer documents.

As on March 31, 2026 outstanding debt securities/instruments were as under:

Borrowing from Banks and Financial Institutions

Your Company raised funds for its working capital and business requirements from various banks and financial institutions.
The total amount of loan outstanding from Banks/FIs as on March 31, 2026 was ^30434.03 Million as against ^22,982.48
Million on March 31, 2025.

Timely Repayment of Debt Liabilities

During the year under review, the Company has duly serviced all its debts obligations in time.

During the year, the Company has also made payments of interest and principal on Non-Convertible Debentures as per
the terms of issue(s).

Accordingly, there was no event of default in interest/principal payments during the year.

Dematerialization of Equity Shares

Equity Shares of the Company are compulsorily tradable in demat form. As on March 31, 2026, 99.99% of the Equity Shares
of total outstanding fully paid-up equity shares of the Company were in dematerialized from and only 10 Equity Shares of
?1/- each out of total Equity Shares are in physical form.

Dividend Distribution Policy

In terms of Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Reserve Bank
of India (Non-Banking Financial Companies-Prudential Norms on Declaration of Dividends) Directions, 2025, the Company
had formulated a Dividend Distribution Policy of the Company, which sets out the parameters and circumstances to be
considered by the Board in determining the distribution of dividend to its shareholders and/or retaining profit earned.

The policy is available on the website of the Company athttps://www.paisalo.in/pdf/corporate governance/policy/
Dividend Distribution Policy1.pdf.

Dividend

The Reserve Bank of India ("RBI"), vide the Reserve Bank of India (Non-Banking Financial Companies - Prudential Norms on
Declaration of Dividends) Directions, 2025, has prescribed a framework governing declaration of dividends by NBFCs.

Accordingly, the Board of Directors, after considering various relevant factors and in compliance with the aforesaid
Directions, has recommended for approval of the Members at the ensuing Annual General Meeting ("AGM"), a final dividend
of ^0.10 (10%) per Equity Share having a face value of ?1 each for the financial year under review.

The dividend recommended is in accordance with the principles and criteria set out in the Company's Dividend Distribution
Policy. Further, the total dividend proposed for the financial year is within the limits prescribed under the aforesaid RBI
Directions.

Pursuant to the provisions of the Income-tax Act, 1961, the dividend, if declared at the ensuing AGM, shall be taxable in the
hands of the Members of the Company.

Unclaimed Dividend and Unclaimed Shares

Pursuant to Rule 5(8) of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund)
Rules, 2016, your Company furnished a statement / information of the unclaimed dividends amounting to ^1,88,359.55 as
on March 31, 2025 in Form IEPF 2 to the Ministry of Corporate Affairs. For the year under review, there was an amount of
^12634.00 as unpaid and unclaimed dividend for a period of 7 years, accordingly, pursuant to the provisions of Section
124(5) of the Companies Act, 2013, ^12634.00 has been transferred to the Investor Education and Protection Fund (IEPF) of
the Central Government on November 6, 2025.

The Company has uploaded the details of unclaimed dividend on the Company's website at https://www.paisalo.in and
also on website specified by the Ministry of Corporate Affairshttps://www.iepf.gov.in/IEPF/services.html. IEPF is holding 11,740
Shares of the Company at the end of the year under review.

Deposits

Your Company is registered with the Reserve Bank of India ("RBI") as a Non-Deposit Taking Middle Layer Non-Banking
Financial Company ("NBFC-ML") under Section 45-IA of the Reserve Bank of India Act, 1934.

The Directors hereby report that, during the year under review, the Company has not accepted any public deposits within
the meaning of the provisions of the Reserve Bank of India (Non-Banking Financial Companies- Acceptance of Public
Deposits) Directions, 2025 and Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits)
Rules, 2014. The Company continues to remain a Non-Deposit Taking Non-Banking Financial Company in compliance with
the guidelines prescribed by the RBI.

Credit Ratings

A. M/s Infomerics Valuation and Rating Ltd. assigned the following rating to the Company's instruments:

B. M/s Brickworks Ratings India Private Limited, vide its letters dated March 20, 2026, and April 20, 2026 assigned the following
rating to the Company's instruments:

Board of Directors, Key Managerial Personnel (KMP) and Board Meetings

The Company's Board is duly constituted and is in compliance with the requirements of the Companies Act, 2013, SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 and Reserve Bank of India (Non-Banking Financial
Companies - Governance) Directions, 2025 as applicable on the Company and provisions of the Articles of Association of
the Company. The Company's Board has been constituted with requisite diversity, wisdom and experience commensurate
to the business of your Company.

As on March 31, 2026, the Board of Directors of the Company consist of 10 (Ten) Directors, out of whom five are Non¬
Executive Independent Directors.

Details of the Directors are as follows:

During the year under review, the Non-Executive Directors of the Company had no pecuniary relationship or transactions
with the Company, other than sitting fees and reimbursement of expenses, if any.

Appointment/Reappointment of Directors:Executive Director

During the year under review, the Shareholders in the Extra-Ordinary General Meeting of the Company held on May 2, 2025,
have appointed Mr. Vinod Kumar (DIN: 10230437), who was appointed as Additional Director by the Board in its meeting held
on February 4, 2025, as Executive Director of the Company.

Further, at the 33^rd Annual General Meeting held on September 29, 2025, Shareholders approved the re-appointment of Mr.
Anoop Krishna as Whole-Time Director, designated as Executive Director, for a further term commencing from February 23,
2026, till December 31, 2027.

Independent Director

Shareholders in the Extra Ordinary General Meeting held on May 02, 2025 has approved the appointment / re- appointment
pursuant to Section 152 of the Companies Act, 2013:

1. Mr. Jitendra Kumar Ojha (DIN: 11028354) has been appointed as a Non-Executive Independent Director on the Board of
the Company for a period of three consecutive years commencing from May 02, 2025.

2. Mrs. Nisha Jolly (DIN: 08717762) has been re-appointed as a Non-Executive Independent Director on the Board of the
Company for a period of five consecutive years commencing from May 02, 2025.

Retirement by Rotation

During the year under review, Mr. Harish Singh (DIN: 00039501), who retired at the 33^rd Annual General Meeting, was re¬
appointed as a Director of the Company.

In terms of Section 152 of the Companies Act, 2013, Mr. Santanu Agarwal, Deputy Managing Director (DIN: 07069797), is
liable to retire by rotation at the 34^th Annual General Meeting and being eligible for re-appointment, offers himself for
re-appointment as Director. The Board of Directors of the Company, in its meeting held on August 05, 2026, based on the
recommendation of the Nomination and Remuneration Committee, recommended to the Members the re-appointment
of Mr. Santanu Agarwal as a Director of the Company, liable to retire by rotation.

Brief particulars of proposed appointee director as required under the Secretarial Standards on General Meetings
issued by the Institute of Company Secretaries of India and Regulation 36 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 is provided in the Notice convening the 34^th Annual General Meeting.

Retirement as an Independent Director

During the year under review, two consecutive terms of Mr. Gauri Shankar (DIN: 06764026) as an Independent Director has
been completed on July 21, 2025 and in accordance with Section 149(11) of the Companies Act, 2013, which stipulates that
no person can hold the office of Independent Director for more than two consecutive terms, he ceased to be a Director of
the Company effective July 21, 2025.

Recommendation for Reappointment of Executive Director

In terms of provisions of Section 196(2) of the Companies Act, 2013, no company shall appoint or re-appoint any person as
its Executive Director or Whole-time Director for a term exceeding five years at a time. The current tenure of Mr. Santanu
Agarwal (DIN: 07069797) as Executive Director is due to expire on May 5, 2027.

Accordingly, based on the recommendation of Nomination and Remuneration Committee of the Company, the Board of
Directors recommends re-appointment of Mr. Santanu Agarwal as Executive Director, designated as Deputy Managing
Director, whose term is completing on May 5, 2027, for a further term of five (5) consecutive years with effect from May 6,
2027, for approval through Ordinary Resolution by Shareholders of the Company.

Brief particulars of Mr. Santanu Agarwal as required under the Secretarial Standard on General Meetings issued by the
Institute of Company Secretaries of India and Regulation 36 of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 is provided in the Notice convening the 34^th Annual General Meeting of the Company.

KMPs

Save, and except as stated above, there are no other changes in the KMPs during the financial year 2025-26.

Declaration of Independence by Independent Directors & adherence to the Company's Code of Conduct for Independent
Directors

Pursuant to Section 149 (7) of the Companies Act, 2013, all Independent Directors had given declaration and necessary
confirmation of eligibility under Section 149(6) of the Companies Act, 2013, and that they qualify to be Independent Directors
pursuant to the Rule 5 of the Companies (Appointment and Qualification of Directors) Rules, 2014. In terms of Regulation 25(8)
of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Independent Directors have confirmed their
eligibility as per Regulation 16 (1) (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and 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. Further, the Board has ensured the veracity of the disclosures and opines that
there has been no change in the circumstances which may affect their status as Independent Directors of the Company
and the Board is satisfied of the integrity, expertise, and experience (including proficiency in terms of Section 150(1) of the
Act and applicable rules thereunder) of all Independent Directors on the Board.

Further, all the Independent Directors have affirmed that they have adhered and complied with the Company's Code of
Conduct for Independent Directors which is framed in accordance with Schedule IV of the Companies Act, 2013. All the
Directors meet the 'Fit and Proper' criteria as per the Company's policy and as stipulated by the RBI.

Meetings of the Board

During the year under review, a total of Five Meetings of the Board of Directors of the Company were held, i.e., on April 8,
2025; May 9, 2025; July 21, 2025; November 10, 2025 and February 6, 2026.

Details of Board composition and Board Meetings held during the financial year 2025-26 have been provided in the
Corporate Governance Report, which forms part of this Report.

Audit Committee

The Company has an Audit Committee duly constituted in accordance with the provisions of Section 177 of the Companies
Act, 2013, para 17 of the RBI (Non-Banking Financial Companies - Governance) Directions, 2025, and Regulation 18 of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended. All the members of the Committee have
expertise in finance and have knowledge of accounting and financial management.

The scope of the activities of the Audit Committee are in compliance with the provisions, as set out in Regulation 18 of the
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and read with Section 177 of the Companies Act,
2013 and the RBI (Non-Banking Financial Companies - Governance) Directions, 2025.

As on 31^st March, 2026, the Committee comprised of Mr. Vijuy Ronjan, Independent Director, as Chairman, Mrs. Nisha Jolly,
Independent Director, as Member, and Mr. Harish Singh, Executive Director, as Member.

The detailed composition of the Audit Committee & its terms of reference and the details of meetings attended by the
Audit Committee members are provided in the Corporate Governance Report, which forms part of this Annual Report.

During the year under review, all the recommendations of the Audit Committee were accepted by the Board of Directors
of the Company.

Stakeholder Relationship Committee

The Stakeholder Relationship Committee of the Board consists of Independent Directors namely Dr. Dharmendra Singh
Gangwar, as Chairperson and Mr. Raman Aggarwal, Mr. Vijuy Ronjan are as Members of the Committee. The composition,
terms of reference and details of meetings held during the year are disclosed in the Report on Corporate Governance.

The detailed composition of the Stakeholder Relationship Committee & its terms of reference and the details of meetings
attended by the Stakeholder Relationship Committee members are provided in the Corporate Governance Report, which
forms part of this Annual Report.

Nomination and Remuneration Committee

The Company has a Nomination and Remuneration Committee duly constituted in accordance with the provisions of
Section 178 of the Companies Act, 2013, para 18 of the RBI (Non-Banking Financial Companies - Governance) Directions,
2025, and Regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended.

The Nomination and Remuneration Committee ('NRC') recommends to the Board the suitability of candidates for
appointment as Director/Managing Director, Key Managerial Personnel and the remuneration packages payable to them.

The composition of the Nomination and Remuneration Committee & its terms of reference and the details of meetings
attended by the members are provided in Corporate Governance Report which forms part of this Annual Report.

Details of other Committees are provided in the Corporate Governance Report which forms part of this Annual Report

Annual Evaluation of Board, its Committees, and Individual Directors

Pursuant to the provisions of Section 178 of the Companies Act, 2013 and Regulation 17(10) read with Part D of Schedule
II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with the SEBI Guidance Note on
Board Evaluation for Listed Companies issued vide Circular No. SEBI/ho/CFD/CMD/CIR/p/2017/004 dated January 5,
2017, the Board has carried out an annual evaluation of its own performance, the performance of its Committees and
that of individual Directors. Structured questionnaire-based feedback was obtained from each Director as part of the
performance evaluation process. Based on the feedback received, the Board and the Nomination and Remuneration
Committee reviewed the performance of the individual Directors, including the Managing Director, and various Committees
constituted by the Board at their respective meetings.

The performance evaluation of the individual Directors, including the Managing Director, was carried out based on
various criteria such as professional conduct, discharge of roles and responsibilities, effective participation in Board
and Committee meetings, contribution to strategic guidance and decision-making, preparedness on agenda items,
and overall contribution to the growth and governance of the Company. Similarly, the evaluation of the Board and its
Committees was conducted taking into consideration various parameters including the composition and structure of the
Board, effectiveness of Board processes, adequacy and timeliness of information flow, clarity of roles and responsibilities,
effectiveness of the functioning of the Board and its Committees, and the quality of engagement between the Board and
the management. The evaluation process is aimed at ensuring continuous improvement in the effectiveness of the Board
and strengthening governance standards within the Company.

In a separate meeting of the Independent Directors held on February 6, 2026, pursuant to Regulation 25(4) of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 and Schedule IV to the Companies Act, 2013, the
Independent Directors:

i. reviewed the performance of the Non-Independent Directors and the Board as a whole;

ii. reviewed the performance of the Managing Director, taking into account the views of the Executive and Non¬
Executive Directors; and

iii. assessed the quality, quantity and timeliness of the flow of information between the management of the Company
and the Board, necessary for the Board to effectively and reasonably perform its duties.

The Board of Directors expressed satisfaction with the evaluation process and its outcomes.

With a continued focus on sustainable growth and value creation for all stakeholders, your Directors remain committed to
devoting their best efforts towards the continued development and progress of the Company.

Policy on Directors' Appointment and Remuneration

To ensure effective and efficient management of the affairs of the Company, the Company has consistently maintained
an optimum combination of Executive and Independent Non-Executive Directors on the Board. All appointments to the
Board are made in compliance with the applicable provisions of the Companies Act, 2013, the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, and the direction issued by the Reserve Bank of India ("RBI").

Generally, the Managing Director and Whole-time Directors (Executive Directors) are appointed for a term of five years.
Independent Directors are appointed for a term of up to five consecutive years on the Board. Based on the outcome of
their performance evaluation, eligibility for reappointment and recommendations of the Nomination and Remuneration
Committee, Independent Directors may be considered for reappointment for a second consecutive term subject to the
approval of the shareholders.

The selection and appointment of Directors are based on a comprehensive evaluation of various criteria, including
personal and professional ethics, integrity, values and character; alignment with the Company's vision, mission and values;
standing and reputation in their respective fields, professional skills, expertise, knowledge and financial literacy. The Board
also considers such other competencies and capabilities as may be required for effective governance and long-term
strategic oversight.

In addition to the aforesaid criteria, the candidature of an Independent Director is evaluated with reference to the
independence criteria prescribed under the Companies Act, 2013, the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, the directions issued by the RBI and other applicable laws, regulations and guidelines. In case of
reappointment of Directors, the Board also considers the outcome of the performance evaluation process and the level of
engagement and contribution made by such Directors during their tenure.

Appointments at the senior management level are made strictly on the basis of merit and competence. Directors,
Key Managerial Personnel ("KMPs") and Senior Management Personnel retire in accordance with the provisions of the
Companies Act, 2013 and the policies of the Company.

The Company has in place a Remuneration Policy for Directors, KMPs and other employees, which is reviewed by the Board
from time to time. The Policy sets out the guiding principles and framework governing the remuneration of Directors, KMPs
and employees of the Company.

The relevant policy(ies) are available on the website of the Company and can be accessed at Investor Relations Section
athttps://paisalo.in/home/investorrelation.

Compliance with the Code of Conduct of Board of Directors and Senior Management

The Board of Directors and Senior Management of the Company have complied with the Company's Code of Conduct
applicable to Board of Directors and Senior Management. In this regard, declaration signed by the Managing Director is
annexed and forms part of this Report.

Directors' Responsibility Statement

Pursuant to the requirement under Section 134(3)(c), read with Section 134(5) of the Companies Act, 2013 with respect to
Directors' Responsibility Statement, the Directors, to the best of their knowledge and belief, hereby confirm that:

a) i n the preparation of the annual accounts, the applicable accounting standards have been followed and that no
material departure has been made in following the same;

b) appropriate accounting policies have been selected and applied consistently and judgements and estimates made
are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the
financial year and of the profit of the Company for that period;

c) proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of
Companies Act, 2013 have been taken for safeguarding the assets of the Company and for preventing and detecting
frauds and other irregularities;

d) the annual accounts have been prepared on a going concern basis;

e) internal financial controls to be followed by the Company had been laid down and such internal financial controls
are adequate and operating effectively; and

f) proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such
systems are adequate and operating effectively.

Auditors & Audit ReportsStatutory Auditor and Statutory Audit Report:

The Reserve Bank of India ("RBI"), vide its Notification No. RBI/2021-22/25 Ref. No. DoS.CO.ARG/SEC.01/08.91.001/2021-22 dated
April 27, 2021, prescribed the eligibility criteria for appointment of Statutory Central Auditors ("SCAs")/Statutory Auditors
("SAs") of Commercial Banks (excluding RRBs), Urban Cooperative Banks ("UCBs") and Non-Banking Financial Companies
("NBFCs"), including Housing Finance Companies ("HFCs").

In terms of paragraph 8 of the aforesaid guidelines, an NBFC may appoint Statutory Auditors for a continuous period
of three years. Accordingly, the Members of the Company at the 32^nd Annual General Meeting held on September 23,
2024, approved the appointment of M/s. Saket Jain & Co., Chartered Accountants (Firm Registration No. 014685N), as the
Statutory Auditors of the Company to hold office until the conclusion of the 35^th Annual General Meeting of the Company.

The Report issued by the Statutory Auditors, M/s. Saket Jain & Co., Chartered Accountants, on the Financial Statements
of the Company for the financial year 2025-26, forms part of the Annual Report. The Notes to the Financial Statements
referred to in the Auditors' Report are self-explanatory and, therefore, do not call for any further comments under Section
134 of the Companies Act, 2013.

The Auditors' Report for the financial year 2025-26 does not contain any qualification, reservation, adverse remark or
disclaimer.

Secretarial Auditor and Secretarial Audit Report of the entity:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 24A of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, as amended, the Members of the Company at the 33^rd Annual General Meeting held on
September 29, 2025, approved the appointment of M/s. Satish Jadon & Associates, Practicing Company Secretaries, as the
Secretarial Auditors of the Company to conduct Secretarial Audit for a continuous period of 5 (five) years and to issue the
Secretarial Audit Report in Form No. MR-3

The Secretarial Audit Report issued by M/s. Satish Jadon & Associates for the financial year ended March 31, 2026 does not
contain any qualification, reservation, adverse remark or disclaimer.

The Secretarial Audit Report in Form No. MR-3 forms part of this Board's Report and is annexed herewith as Annexure A.

Pursuant Regulation 24A(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has
obtained Secretarial Compliance Report for financial year ended March 31, 2026, from Practicing Company Secretary on
compliance of all applicable SEBI Regulations and circular/ guidelines issued thereunder and the copy of same has been
submitted with the Stock Exchanges within the prescribed due date.

Fraud Reported by Auditors under Section 143(12) of the Companies Act, 2013

During the period under review, neither the Statutory Auditors nor the Secretarial Auditors have reported to the Audit
Committee/ Board or Central Government any instances of fraud in the Company by its officers or employees under
Section 143(12) of the Companies Act, 2013 and therefore, no detail is required to be disclosed under Section 134(3)(ca) of
the Companies Act, 2013.

Secretarial Standards

During the year under review, the Company has complied with the applicable Secretarial Standards issued by the Institute
of Company Secretaries of India.

Maintenance of Cost Records

The maintenance of cost records, for the services rendered by the Company, is not required pursuant to Section 148 (1) of
the Companies Act, 2013 read with Rule 3 of the Companies (Cost Records and Audit) Rules, 2014.

Particulars of Loans, Guarantees or Investments Under Section 186 of Companies Act, 2013

Being RBI registered Non-Banking Financial Company and engaged in the business of giving loans in ordinary course of
its business, accordingly, pursuant to Section 186(11) of the Companies Act, 2013 the provisions of Section 186, except Sub¬
Section 1 of the said Section, shall not apply on the Company, hence disclosure under Section 134 (3) (g) of the Companies
Act, 2013, of particulars of the loans given securities provided under Section 186 of the Companies Act, 2013 is not applicable
to the Company.

The details of Investment made by the Company have been disclosed in the note no. 6 of the Standalone Financial
Statement for the year ended March 31, 2026. The Company has given its guarantee only for the credit facilities availed by
its Wholly Owned Subsidiary M/s. Nupur Finvest Private Limited.

Particulars of Contracts or Arrangements with Related Parties

The Board of Directors of the Company has formulated a Policy on Materiality of Related Party Transactions and dealing
with Related Party Transactions ("RPT Policy") in accordance with the applicable provisions of the Companies Act, 2013
and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended. The Policy lays down the
framework for identification, review, approval and monitoring of related party transactions and is available on the website
of the Company. All related party transactions are placed before the Audit Committee for its review and approval.

During the financial year under review, all related party transactions entered into by the Company were in the ordinary
course of business and on an arm's length basis. Accordingly, the disclosure of material related party transactions at
arm's length basis as required under Section 134(3)(h) of the Companies Act, 2013, in Form AOC-2 forms part of this Board's
Report and is annexed herewith as Annexure B.

Disclosure of the related party transactions as required under Regulation 34(3) and 53 (f) of SEBI Listing Regulations and
Indian Accounting Standard 24 ("Ind AS 24") are reported in Note No. 37 forming part of the Audited Standalone Financial
Statements of the Company for the financial year ended 31^st March 2026.

The Policy on Materiality of Related Party Transactions and dealing with related party transactions is available on the website
of the Company and may be accessed at Related Party Transactions Policy Policy_on_Related_Party_Transactions25.pdf.

Change in the Nature of Business, if any

During the period under review, there was no change in the nature of the business of the Company.

Material Changes and Commitments, if any, Affecting the Financial Position of the Company

There have been no material changes and commitments affecting the financial position of the Company which occurred
between the end of the financial year and the date of this Report.

Information on Material Orders Passed by the Regulators or Courts or Tribunal

During the period under review, there were no significant and material orders passed by the Regulators or Courts or
Tribunals impacting the going concern status and the Company's operations in future.

Furthermore, no penalties were imposed by the RBI or any other regulatory authority during the year under review.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

As the Company is engaged in the financial services activities, its operations are not energy intensive nor does it require
adoption of specific technology and hence information in terms of Section 134(3)(m) of the Companies Act, 2013, read with
the Companies (Accounts) Rules, 2014, to the extent applicable, are as follows:

• being a Non-banking Finance Company, the particulars regarding conservation of energy and technology absorption
as required to be disclosed pursuant to the Rule 8(3) of the Companies (Accounts) Rules, 2014 are not relevant to its
activities.

• Foreign Exchange earnings for the Company during the financial year under review was nil and Company's Foreign
Exchange outgo during the financial year under review was equal to ^1436.54 Million as against ^152.49 Million in the
previous year.

Corporate Social Responsibility

Your Company aspires to contribute positively to the community's well-being as a part of the Company's vision and
accordingly carries out CSR initiatives in line with Schedule VII of the Companies Act, 2013. In compliance with Section
135 of the Companies Act, 2013, read with Rules made thereunder and as amended from time to time, the Company
has established the Corporate Social Responsibility Committee ("CSR Committee") and formulated Company's CSR
Policy, which is available on the website of the Company athttps://www.paisalo.in/pdf/corporate governance/policy/
CSR POLICY1.pdf. The Company undertakes its CSR initiatives directly and/or through partnering with a trust/foundation,
qualified to undertake CSR activities in accordance with Schedule VII of the Companies Act, 2013 (includes amendments
thereto).

For the financial year 2025-26 the Board of Directors of the Company in their meeting held on May 9, 2025 approved ^42.30
Million as the budget for CSR activities. During the financial year 2025-26, Company has spent ^43.78 Million CSR fund in
various activities which are disclosed in the Annual Report on CSR activities for financial year 2025-26 under Section 135
annexed with this report as Annexure C.

Composition of CSR Committee is disclosed in Corporate Governance Section of this Annual Report as part of Board's
Report.

Business Responsibility and Sustainability Report

In adherence to Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, read
with SEBI Circular No. SEBI/ho/CFd/cmd-2/p/CIR/2021/562 dated May 10, 2021, the Business Responsibility and Sustainability
Report (BRSR) for financial year 2025-26, outlining the environmental, social, and governance (ESG) initiatives of your
Company, is an integral part of this Annual Report. Additionally, this report provides comprehensive insights into the diverse
ESG endeavors undertaken by your Company.

A comprehensive "Business Responsibility and Sustainability Report" (BRSR), formatted as per SEBI guidelines, detailing the
Company's initiatives, actions, and processes towards ESG endeavors, is appended as Annexure D and forms part of this
Report and can also be accessed on the Company's website at www. paisalo.in.

Internal Financial Control

The Company remains steadfast in its commitment to maintaining a robust and effective internal financial control
framework that supports sustainable growth, operational excellence and sound corporate governance. This continued

focus enables the Company to conduct its business operations in an efficient and orderly manner, safeguard its assets,
prevent and detect frauds and errors, ensure the accuracy and completeness of accounting records, and facilitate the
timely preparation of reliable financial and management information.

To achieve these objectives, the Company has established a comprehensive internal control framework that is
commensurate with the size, scale and complexity of its operations. The framework is designed to ensure strict adherence
to internal policies, regulatory requirements and applicable laws, while remaining agile and responsive to the evolving
business environment. As the Company continues to expand its operations, these controls play a critical role in
strengthening governance standards and enhancing the identification, mitigation and prevention of potential risks, frauds
and operational discrepancies. The Board of Directors is of the opinion that the Company's internal financial controls over
financial reporting are adequate and operating effectively.

The internal control environment is further reinforced through a well-defined system of internal audits, external audits and
continuous management oversight. These processes collectively ensure the reliability of financial reporting, protection of
assets and adherence to established procedures and controls. The Company engages experienced and independent
professionals to conduct internal audits and evaluate the adequacy, effectiveness and efficiency of the internal control
systems across various functions and processes.

The Internal Audit function plays an integral role in supporting the Audit Committee and the Risk Management Committee
by undertaking detailed reviews of risk management processes, internal control mechanisms and corrective action plans
implemented by management. The findings of internal audits, along with risk assessment reports, are periodically reviewed
by the respective Committees to ensure effective oversight and continuous improvement in governance practices. In
addition, the effectiveness and robustness of internal financial controls are periodically validated through independent
testing by Internal Auditors, while the Statutory Auditors provide assurance on the adequacy of financial reporting controls.

The Company continuously strengthens and refines its Internal Financial Control framework to align with changes in the
business landscape, emerging risks and evolving regulatory and accounting standards. During the year under review,
no material weaknesses, significant deficiencies or adverse observations were reported in relation to the adequacy or
effectiveness of the Company's internal financial control systems.

Risk Management

In compliance with the regulatory framework applicable to Non-Banking Financial Companies ("NBFCs"), the Company has
established a comprehensive and robust Risk Management framework designed to ensure the systematic identification,
assessment, monitoring and mitigation of risks across all levels of its operations and business activities. The framework
enables the Company to proactively manage emerging risks while supporting sustainable growth and long-term value
creation.

To strengthen the governance and oversight of risk management practices, the Company has constituted various
Committees, including the Risk Management Committee, the Audit Committee, the Asset Liability Management Committee
("ALCO") and Fraud Monitoring Committee. The composition, roles, responsibilities and frequency of meetings of these
Committees are detailed in the Report on Corporate Governance, forming an integral part of this Annual Report.

These Committees play a vital role in assisting the Board in identifying, evaluating and effectively managing strategic,
operational, financial, regulatory and business risks in a structured and disciplined manner.

The Company has also adopted a comprehensive Risk Management Policy that provides an integrated approach towards
risk governance with a focus on maintaining business resilience, operational stability and sustainable growth.

The Risk Management Policy establishes a well-defined framework for identifying key risk events, assessing their potential
impact, implementing appropriate mitigation measures and ensuring continuous monitoring and timely reporting of risks.
The framework is regularly reviewed and strengthened to align with evolving business dynamics, regulatory expectations
and industry best practices.

The Risk Management framework includes:

• Clearly defined risk governance structure with assigned roles and responsibilities;

• Identification and evaluation of principal business risks;

• Implementation of control measures to manage and mitigate these risks;

• A detailed Business Continuity Plan (BCP) to ensure resilience in adverse scenarios;

• Periodic monitoring and review of risk exposures and mitigation strategies.

• The Company follows a disciplined approach to risk management, aligning business decisions with a well-balanced
risk-reward strategy, thereby safeguarding stakeholder interests and supporting long-term value creation.

Human Resources

The Company's industrial relations remained harmonious during the period under review. The Company strives to provide
the best work environment with ample opportunities to grow and explore. Healthy, cordial and harmonious industrial
relations have been maintained by the Company at all levels.

Disclosures as per the provisions of Section 197 (12) of the Companies Act, 2013.

The disclosures relating to remuneration and other particulars as required under Section 197(12) of the Companies Act, 2013
read with Rule 5(l) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of
this Board's Report and is annexed herewith as Annexure E.

In accordance with the provisions of Section 136(f) of the Companies Act, 2013, the Annual Report and the Financial Statements
are being circulated to the Members excluding the statement containing particulars of employees as prescribed under
Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

The said information is available for inspection by the Members at the Registered Office of the Company during business
hours on working days. Any Member interested in obtaining a copy of the same may write to the Company Secretary at
and the requisite information shall be furnished upon such request.

The Board of Directors affirms that the remuneration paid to the Directors, Key Managerial Personnel and employees of the
Company is in accordance with the Remuneration Policy of the Company.

Compliance with Provisions of Sexual Harassment of Women at Work Place (Prevention, Prohibition & Redressal) Act, 2013

The Company is committed to providing a safe, secure and inclusive work environment for all its employees and has zero
tolerance towards sexual harassment at the workplace. In line with the requirements of the Sexual Harassment of Women
at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("POSH Act") and the Rules made thereunder, the Company
has in place a Policy on Prevention of Sexual Harassment at Workplace.

The Company has constituted an Internal Committee ("IC") in compliance with the provisions of the POSH Act to redress
complaints relating to sexual harassment and to ensure timely resolution of grievances. The Policy aims to promote a
workplace free from harassment, discrimination and intimidation, thereby fostering a culture of dignity, respect and equal
opportunity.

The Company regularly undertakes awareness initiatives and sensitisation programmes for employees to promote
understanding and compliance with the provisions of the POSH Act.

The details pertaining to complaints received and disposed of during the financial year 2025-26 are as under:

Throughout the financial year 2025-26, the Company received one complaint from employees concerning sexual
harassment.

Compliance with Maternity Benefits Act, 1961.

The Company has complied with the provisions of Maternity Benefits Act, 1961.

Compliance of Reserve Bank of India Directions

Paisalo Digital Limited is categorised as a Non-Deposit Taking Middle Layer Non-Banking Financial Company ("NBFC-
ML"). The Company continues to comply with all the prudential norms and standards prescribed by the Reserve Bank
of India ("RBI") relating to governance, asset classification, non-performing assets, capital adequacy, statutory liquidity
requirements and other applicable regulatory parameters.

During the financial year 2025-26, the Company has complied with the applicable provisions of the directions, circulars
and guidelines issued by the RBI from time to time governing Non-Deposit Taking Middle Layer Non-Banking Financial
Companies.

Annual Return

In accordance with the provisions of Section 92(3) read with Section 134(3) (a) of the Act and the applicable rules, Annual
Return of the Company for the financial year March 31, 2026, in the prescribed form, is hosted on website of the Company
athttps://paisalo.in/pdf/annual report/MGT-7 PAISAIO 2025-26.pdf.

Management Discussion and Analysis

The Management Discussion and Analysis report for the year under review, as required under Regulation 34(2)(e) of the
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is provided as a separate section forming part of
the Annual Report.

Vigil Mechanism/Whistle Blower Policy

The Company, in accordance with the provisions of Section 177(9) of the Companies Act, 2013 read with Rule 7 of the
Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, has established a robust Vigil Mechanism through its Whistle Blower Policy.

The mechanism enables Directors and employees of the Company to report genuine concerns relating to unethical
behaviour, actual or suspected fraud, misconduct, or violation of the Company's Code of Conduct.

The Whistle Blower Policy provides adequate safeguards against victimisation of persons who use such mechanism and
also ensures direct access to the Chairman of the Audit Committee in appropriate or exceptional cases. The framework
reflects the Company's commitment to maintaining the highest standards of ethical, moral and legal business conduct
and promoting a culture of transparency and accountability across the organization.

The Whistle Blower Policy is available on the website of the Company at Paisalo Digital Limited Website. Further details
relating to the Vigil Mechanism/Whistle Blower framework are provided in the Corporate Governance Report forming part
of this Annual Report.

During the financial year 2025-26, no complaint or case was reported under the aforesaid Vigil Mechanism.

Listing with Stock Exchanges

Equity shares (ISIN INE420C01059) of the Company are listed on BSE Limited (BSE) and National Stock Exchange of India
Limited (NSE).

Rated Non-Convertible Debentures (NCDs) issued on private placement basis and Commercial Papers (CPs) are listed on
BSE.

Foreign Currency Convertible Bonds (FCCBs) are listed on Afrinex Exchange, Mauritius and India International Exchange
(IFSC) Limited (India INX).

The listing fees payable to both the exchanges for the Financial Year 2026-27 have been paid.

Prevention of Insider Trading

The Company has implemented a Code of Conduct for Prevention of Insider Trading to regulate securities trading by
Directors and Designated Employees. As part of this framework, the Company utilizes software with a structured digital
database to maintain records of individuals with whom unpublished price sensitive information has been shared. This
database includes details of the information shared and the names of such individuals, along with their Permanent
Account Numbers (PAN). Company is also complied with the extending framework for restricting trading by Designated
Persons ("DPs") by freezing PAN at security level. The full text of the Code of Conduct for Prevention of Insider Trading is
accessible on the Company's website at:https://www.paisalo.in/pdf/corporate governance/policy/Code of conduct
for prevention of Insider Trading1.pdf.

Disclosures Under the Insolvency and Bankruptcy Code, 2016

No application for Bankruptcy under the Insolvency & Bankruptcy Code, 2016 ("IBC") was made against the Company
during the financial year under review.

Further, there are no details required to be reported with regard to difference between amount of the valuation done at
the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions as your
Company has not done any settlement with any Bank or Financial Institutions since its inception.

Corporate Governance

The Company firmly believes that robust corporate governance forms the foundation for sustainable business growth and
the effective management of relationships among all stakeholders. It consistently strives to strengthen these relationships
through principles of fairness, transparency, and accountability. The Company places utmost importance on the integrity

of financial reporting, transparency, fairness, empowerment, and full compliance with the law-both in letter and spirit.

In adherence to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with
Schedule V thereof, the Report on Corporate Governance for the financial year ended March 31, 2026, is included as a
distinct section of this Annual Report. A certificate from the Company's Secretarial Auditor, confirming compliance with the
prescribed corporate governance norms, is annexed to the Report.

Certificate from the Managing Director and Chief Financial Officer

The certificate received from Mr. Sunil Purushottanm Agarwal, Managing Director & CEO and Mr. Harish Singh, Executive
Director and Chief Financial Officer with respect to the financial statements and other matters as required under Part B of
Schedule II to the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 forms part of this Report.

Acknowledgments

The Board of Directors places on record its sincere appreciation for the continued support, guidance and cooperation
extended by various regulatory authorities and Government agencies. The Board also expresses its deep gratitude to the
Company's banking partners, business associates and all other stakeholders whose continued trust and collaboration
remain vital to the Company's sustained growth and success.

Your Directors highly acknowledge the dedication, commitment and relentless efforts of the employees at all levels,
including the management team under the leadership of the Executive Directors. Their professionalism, resilience and
unwavering pursuit of excellence, particularly in a dynamic and challenging business environment, continue to be a key
driving force behind the Company's progress and achievements. The Board also conveys its heartfelt gratitude to the
Members of the Company for their continued confidence, encouragement and support.

The Board further places on record its sincere appreciation for the valuable contribution made by the Non-Executive
Independent Directors. Their rich experience, strategic guidance, independent judgment and constructive counsel have
played a significant role in strengthening governance standards, enhancing decision-making processes and steering the
Company towards the achievement of its strategic objectives.

As the Company moves forward with renewed optimism and confidence, the Board looks ahead to the future with a strong
sense of purpose and remains grateful for the continued support and trust of all stakeholders in the Company's journey of
sustainable growth and value creation.

Place : New Delhi For & on behalf of the Board of Directors of

Date : 05.08.2026 Paisalo Digital Ltd.

Sd/- Sd/-

Sunil Purushottanm Agarwal Harish Singh

Managing Director & CEO Executive Director

DIN : 00006991 DIN : 00039501