This document contains statements about expected future events, and financial and operating results of Arohan Financial Services Limited (“Arohan”/”Company”), which are forward-looking. By their nature, forward-looking statements require the Company to make assumptions and are subject to inherent risks and uncertainties. There is a significant risk that the assumptions, predictions and other forward-looking statements will not prove to be accurate. Readers are cautioned not to place undue reliance on forward-looking statements as a number of factors could cause assumptions, actual future results, and events to differ materially from those expressed in the forward-looking statements. Accordingly, this document is subject to the disclaimer and qualified in its entirety by the assumptions, qualifications and risk factors referred to in the management’s discussion and analysis of Arohan’s Annual Report, FY 2026. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Further, Arohan cannot guarantee that these forward-looking statements will be realised, although the Company believes that it has been prudent in its assumptions.
Corporate Overview Progress in every hand At Arohan Financial Services Limited, progress is not measured only in numbers, but in the lives, livelihoods, and aspirations of the people we serve. As a technology-enabled NBFC-MFI and a part of the Aavishkaar Group, our journey has always been guided by an entrepreneurship-led approach to development — enabling individuals to build, sustain, and grow their own economic futures. The theme of this year’s Annual Report, “Progress in Every Hand,” reflects this belief. Across India, millions of working hands drive the informal economy. Be it sewing, farming, cooking, crafting or trading. These hands represent resilience, enterprise, and untapped potential. Our role is to reach these hands with timely credit, thoughtful support, and responsible financial services that help livelihoods grow steadily and sustainably. This report presents a narrative that goes beyond performance metrics. It traces a journey from working hands that power local economies, to helping hands that extend financial access and guidance, to growing hands supported by strong systems, processes, and people, and ultimately to empowered hands managing thriving enterprises with confidence. Through this year’s Annual Report FY 2026, readers will see how Arohan’s business model, operational discipline, and people practices come together to create meaningful impact at scale. “Progress in Every Hand” is not just a theme - it is a reflection of how we see development: personal, practical, and powered by people.
Growth in every hand Value for Every Stakeholder At Arohan, progress is meaningful only when it reaches every hand we touch. Our approach to value creation goes beyond financial performance to enable holistic growth for all stakeholders — customers, employees, shareholders, and the environment. Guided by this belief, we continue to build an ecosystem where each stakeholder advances alongside us. Arohan remains deeply committed to understanding and addressing the evolving needs of its customers through innovative solutions and dependable service. By nurturing relationships founded on trust and integrity, we enable our customers to grow their livelihoods and achieve greater financial resilience — creating a cycle of shared progress and long-term prosperity. This commitment to customer-centric excellence is reflected in our continued recognition as the highest-rated MFI 1 by CARE Edge Analytics & Advisory for FY 2026. CUSTOMERS Enabling Growth at the Grassroots
Our employees are the hands that drive Arohan’s journey forward. We foster a culture of inclusivity, respect, and continuous learning, where every individual is encouraged to realise their full potential. Through focused investments in capability building, career development, and a supportive workplace, we ensure that our people grow as Arohan grows. Our people-first philosophy earned us a place among India’s Top 100 Best Companies to Work For, ranking 35th, and recognition as the Best Workplace in the Microfinance Industry for 2024 by the Great Place to Work® Institute. EMPLOYEES Empowering Every Individual to Grow Arohan remains committed to delivering sustainable returns through prudent risk management, transparency, and strong governance practices. Our consistent financial performance and disciplined approach ensure that shareholder value grows steadily over time. In FY 2026, we retained our credit ratings ‘A (Stable)’ by ICRA and ‘A-(Stable)’ by Care reaffirming our financial resilience and long-term stability. We recognise that true progress must be environmentally responsible. Arohan actively works to reduce its carbon footprint and promote sustainable practices across operations. Alongside this, we undertake community initiatives aimed at improving awareness, well-being, and environmental stewardship in the regions we operate. These efforts reflect our commitment to ensuring that growth today does not come at the cost of tomorrow. SHAREHOLDERS Strengthening Value through Sterdy Growth ENVIRONMENT Growing Responsibly with the Communities we Serve Corporate Overview
SOLVENCY & LIQUIDITY EFFICIENCY RATIOS NETWORTH INR 2,158 Cr CAPITAL ADEQUACY RATIO 27.61% CREDIT RATING* ICRA A (STABLE OUTLOOK) CARE A- (STABLE OUTLOOK) FEE INCOME (as a % age of total income) 6.15% OPEX 9.02% CASH & CASH EQ. INR 730 Cr (INCLUDES CASH AND CASH EQUIVALENT, BANK BALANCES AND MUTUAL FUNDS) FUNDS DRAWN INR 5,564 Cr AROHAN PRIVILEGE NUMBER OF CUSTOMERS 41,552 PORTFOLIO INR 175.25 Cr *All facilities are rated by ICRA A (Stable), while one facility is rated by CARE A- (Stable) additionally key PERFORMANCE Indicators Information provided is as of, and for the Financial Year ended March 31, 2026.
STATES 16 DISTRICTS 318 CUSTOMER STRENGTH 19.8 Lakh NO. OF EMPLOYEES 9,654 FIELD EMPLOYEE PERCENTAGE 91.70% IMPACT NUMBERS EMPLOYEES BORROWER’S DEMOGRAPHY ASSET UNDER MANAGEMENT INR 7,426 Cr DISBURSEMENT FOR FY 2026 INR 7,063 Cr RURAL 73% NO. OF BRANCHES 1,069 RURAL BRANCH PERCENTAGE 64% SEMI URBAN BRANCH PERCENTAGE 16% SEMI URBAN 11% URBAN 16% WOMEN 98.39% BRANCH Corporate Overview
key highlights On April 6, twenty years ago, Arohan made its first disbursement, embarking on a journey that has transformed countless lives. This twenty years of perseverance, dedication and growth was celebrated as – 20 Years of Distinction. One Arohan. The celebration took place in April 2026, across 42 locations on the same day, along with a special celebration at the corporate level. The 20-year milestone was not only a celebration of achievements, but also a moment to reaffirm Arohan’s Vision 2030 — impacting 20 million lives by 2030. The FY 2026 stood out as a landmark year in Arohan’s journey, marked by record portfolio growth, strengthened asset quality, and continued recognition across industry platforms. The organisation received multiple awards and certifications acknowledging operational resilience, customer-centric practices, and people development. Participation in key industry forums, stakeholder events, and knowledge platforms further reinforced Arohan’s position as a responsible and progressive leader in the microfinance sector. Together, the milestones of the year and the celebrations of two decades reflect not just how far Arohan has come, but the strong foundation it continues to build for the future. AWARDS & RECOGNITIONS Recognised at the CRIF Data Excellence Awards as ‘Promising – Data Quality Improvement (MFI)’ Recognised at The Eastern India Leadership Awards, 2025 as “Organisation with Innovative CSR Practices” Recognised for our contribution to the National Apprenticeship Training Scheme (NATS) by the Board of Practical Training (Eastern Region) 20 Years of Distinction. One Arohan.
RATINGS & GRADINGS EVENTS Arohan’s Information Security Management System gets re-certified with ISO/IEC 27001:2022 by BS Arohan Financial Services Limited Secures Re-Issuance of ISO 9001:2015 Certification from BSI Arohan awarded at top-notch MFI 1 grade, by CareEdge Advisory. Arohan received Code of Conduct Assessment (COCA) score of C1 grading from CARE Edge Analytics and Advisory. Corporate Overview Mr. Manojkumar N Nambiar attends the NBFC Symposium 2025 with Finance Minister of India Arohan successfully completed the e-KYC rollout across the entire organisation Mr. Manojkumar N Nambiar attended Manthan, a microfinance conclave by MFIN Mr. Manojkumar N Nambiar participated in Chintan Workshop at the AMFI-WB Training Centre “Microfinance as key engine of financial inclusion: How it can be made a strong pillar of Viksit Bharat” - Authored article by Mr. Manoj Kumar Nambiar for The Economic Times Arohan released its first Sustainability (ESG) Report, available on our official website Arohan implemented IVR automation for enquiry / inbound calls on its toll-free number. Mr. Manojkumar N Nambiar at the launch of the 5th edition of Micro Matters Macro View FY 2024-25 Launch of Arohan’s Upgraded AI-Powered Assistant in its Business Intelligence Dashboard Launch of the Arohan 20 years’ Anniversary Logo, designed by our very own employees. Aavishkaar Group introduced the Group AI Guidelines: Responsible Use of AI at Aavishkaar Group Arohan website was made available in 12 Indian languages Registered with the National Credit Guarantee Trustee Company to avail credit guarantee coverage under Credit Guarantee Fund for Micro Units Mr. Manojkumar N Nambiar elected as the Chairperson of the Board of Trustees of Association of Microfinance Institutions – West Bengal Onboarded Dista, an AIbased location intelligence platform Started operations in Tamil Nadu with the opening of a regional office in Tiruchirappalli
INDEX Chairman’s Address 01 Vice Chairman’s Address 03 Managing Director’s Address 05 Corporate Information 09 a. Mission, Vision, Values 11 b. Business Verticals 13 c. Product Offerings 15 d. ESG Focus 17 e. Large Customer Base and Diversified Network 19 f. Board of Director’s Profile 21 g. Key Managerial Personnel 25 h. Senior Managerial Personnel 26 Management Discussion & Analysis a. The Many Hands behind India’s Growth 29-36 b. Reaching Every Hand That Works 37-48 c. Steady Hands Behind Every Step Forward 49-60 d. Equipping Hands to Create Impact 61-68 Director’s Report 69-76 Annexures to the Director’s Report 77-114 Auditor’s Report 115-130 Financial Statement 131 - 224
1 | Annual Report | 2025-2026 Chairman’s Address DINESH KUMAR MITTAL Chairman Board of Directors It is my immense privilege and honour to present the Annual Report of Arohan Financial Services Limited for this remarkable financial year. Over the past year, the global and domestic economic environment continued to evolve rapidly, creating new opportunities alongside emerging challenges. Amid this dynamic landscape, Arohan remained unwavering in its commitment to advancing financial inclusion and empowering underserved communities across India. Guided by our strong values, customer-first philosophy, and longterm vision, we continued to strengthen our position as a trusted and purpose-driven financial institution dedicated to creating sustainable impact. This year has been a testament to Arohan’s resilience, adaptability, and relentless pursuit of excellence. Through disciplined execution, prudent risk management, and a sharp focus on customer centric growth, we successfully navigated the changing environment while continuing to deliver long-term value for all stakeholders. At the same time, we accelerated our investments in technology, innovation, and digital transformation to enhance operational efficiency, strengthen governance, and deliver a seamless customer experience. These initiatives are helping us build a stronger, smarter, and future-ready organization capable of driving sustainable growth in an increasingly digital world. At the heart of our progress lies the unwavering trust and confidence placed in us by our customers, employees, business partners, lenders, investors, and shareholders. Their continued support has been instrumental in strengthening the foundation of Arohan and inspiring us to continuously raise the bar. As we move forward, we remain deeply committed to building an inclusive, resilient, and highimpact institution that contributes meaningfully to financial empowerment, economic development, and social progress across the country. The global economy in 2026 continues to demonstrate resilience despite macroeconomic uncertainties, geopolitical developments, supply chain realignments and fluctuations in energy markets. Encouragingly, easing inflationary pressures, sustained infrastructure investments, and supportive fiscal and monetary policies across major economies are creating a more stable and constructive global outlook. These developments are opening up significant opportunities for emerging markets and strengthening the foundation for long-term economic growth and innovation. India continues to stand out as one of the world’s fastest growing major economies, driven by robust domestic demand, strong public and private investments, expanding digital infrastructure, and improving rural consumption. The country’s strong economic fundamentals, reform momentum, and entrepreneurial energy continue to position India as a global growth engine. Inflation is also gradually aligning with the Reserve Bank of India’s long-term target range, reflecting sound macroeconomic management and policy stability. Dear Shareholders, Partners and Colleagues
| 2 Annual Report | 2025-2026 While challenges such as energy dependence, regional disparities, and sector-specific stress continue to require careful attention, we view them as opportunities for innovation, disciplined execution, and strategic transformation. At Arohan, responsible growth, sound governance, portfolio quality, and customer trust remain central to our operating philosophy and long-term strategy. Financial inclusion continues to play a transformative role in India’s development journey. Over the last decade, initiatives such as JAM Trinity - Jan Dhan, Aadhaar, and widespread mobile connectivity have revolutionized access to formal financial services and brought millions into the financial mainstream. Today, the focus is evolving beyond access toward building deeper engagement, financial resilience, and sustainable empowerment for underserved communities. Technology and digital public infrastructure are expected to play a defining role in accelerating this next phase of inclusion. Artificial Intelligence is emerging as a powerful catalyst in reshaping the future of inclusive finance. Across the financial ecosystem, AI-driven technologies are enabling institutions to improve efficiency, strengthen risk management, and deliver more personalized and responsive customer experiences. One of the most significant applications of AI lies in credit assessment, where advanced analytics and machine learning models are enabling lenders to evaluate borrowers with limited formal credit histories through alternative data and predictive insights. This is helping expand responsible access to credit while supporting more informed and prudent lending decisions. India’s rapidly evolving digital public infrastructure is also creating exciting new possibilities for seamless and inclusive financial services. Initiatives such as the Unified Lending Interface (ULI) and the Account Aggregator ecosystem are simplifying credit delivery through secure and consent-based data sharing, thereby improving transparency, reducing turnaround times, and enhancing operational efficiency. Additionally, initiatives like Banking BHASHINI are helping bridge linguistic barriers and making digital financial services more accessible across multiple Indian languages, ensuring deeper inclusion across diverse geographies and customer segments. At Arohan, our journey is guided by a larger social purpose, creating sustainable and meaningful impact at the grassroots level across India. We firmly believe that financial inclusion extends far beyond the provision of credit; it is about empowering individuals, supporting livelihoods, nurturing entrepreneurship, and enabling long-term economic progress. Our approach continues to be rooted in responsible growth, customer empowerment, and inclusive development. Through our continued efforts, we aim to strengthen financial access, create economic opportunities, and improve the quality of life for millions of underserved families. Every initiative we undertake reflects our unwavering commitment to building a more inclusive, resilient, and financially empowered society. By combining technology, innovation, and human-centric engagement, we are creating solutions that are not only scalable and efficient but also deeply impactful. Though our continued efforts, we aim to strengthen financial access, create economic opportunities, and improve the quality of life for millions of underserved families. At Arohan, technology and digital transformation continue to be central to our long-term growth strategy and future readiness. We are consistently investing in strengthening our digital capabilities, modernizing operational processes, and leveraging data-driven insights to enhance operational excellence and deliver a superior customer experience. While we have made significant progress in our digital journey, we also recognize that this is an evolving transformation with immense opportunities ahead. Our employees continue to remain our greatest strength and the driving force behind our success. Their passion, dedication, and commitment to excellence have played a pivotal role in helping Arohan achieve its goals and deliver value to customers across geographies. I would like to express my heartfelt appreciation to every member of the Arohan family for their hard work, resilience, and unwavering commitment to our mission. On behalf of the Board of Directors, I would also like to express my sincere gratitude to our Promoters, fellow Board members, investors, lending partners, and regulatory authorities for their invaluable trust, guidance, and continued support. Their confidence in Arohan’s vision and longterm strategy has been instrumental in strengthening our institution and enabling us to navigate a dynamic operating environment with resilience and purpose. Above all, I extend my deepest gratitude to our 2 million customers, whose trust and belief in Arohan inspire us every single day. Their aspirations motivate us to continuously innovate, improve, and expand our efforts toward building a stronger and more inclusive institution. Together, we remain committed to creating sustainable financial value while contributing meaningfully to inclusive growth, social progress, and nation-building. As we look ahead, we do so with confidence, optimism, and a strong sense of purpose. With a robust foundation, a clear strategic vision, and an unwavering commitment to responsible growth and financial inclusion, Arohan is wellpositioned to continue creating lasting impact and delivering sustainable value for all stakeholders. Together, we will continue empowering lives, strengthening communities, and building a brighter and more inclusive future for India. Dinesh Kumar Mittal Chairman Board of Directors Chairman’s Address
VICE Chairman’s Address VINEET CHANDRA RAI Vice Chairman Arohan Financial Services Limited Founder, Aavishkaar Group A year ago, I wrote to you from within the eye of a storm. FY 2025 had tested Arohan in ways that went beyond the commercial - it questioned our values, our integrity, and our resolve. As I reflect on the year now behind us, I do so with a quieter spirit and a steadier hand, grateful that the institution has not only weathered that storm but emerged from it with greater clarity than before. The world, of course, offers little respite. Geopolitical fault lines continue to widen, and the consequences of climate change grow more visible each passing season - in the floods, the droughts, and the erratic monsoons that fall hardest upon the very communities we serve. Our clients live closest to these disruptions, and yet, year after year, they remain the most resilient stakeholders in our story. It is their determination, and their trust, that reminds us why Arohan exists. This year, that trust was rewarded with renewal. We restored Arohan to health and to profitability, underpinned by prudent risk management, a healthy capital adequacy, and a balance sheet rebuilt on disciplined foundations. Our asset quality has strengthened considerably, our ratings affirmed with a stable outlook, and we now serve close to 2 mn borrowers across 16 states - a remarkable share of whom rely on Arohan alone for their access to formal finance. These are not merely numbers; they are the measure of a promise kept. I have always believed that an institution reveals its true character not in the seasons of plenty, but in the seasons of scrutiny. From our earliest days, Arohan has been built on four pillars - transparency, governance, ethics, and impact. In the past year, these were not abstractions to be admired; they were the armour we wore. We made difficult choices, we leaned on our ethical compass, and we held firm to the conviction that doing what is right is never in conflict with doing what endures. None of this would have been possible without our people. Over 9,600 colleagues carried Arohan forward through a demanding year, and our leadership team continued to steer the institution with steadiness and skill under the stewardship of our Managing Director, Manoj Nambiar. To each of them, my deepest gratitude. I remain thankful to the Reserve Bank of India, whose oversight and guidance through a difficult period were invaluable, and to the Microfinance Industry Network, Dear Shareholders, 3 | Annual Report | 2025-2026
whose stewardship continues to anchor the credibility of our sector. To our shareholders, who stood with us when the path was uncertain, your belief in our longterm mission has been a source of strength. And to our Chairperson and Independent Directors, whose wisdom and counsel kept us grounded in reality and focused on the horizon, I owe a particular debt. In 2001, we set out with a simple conviction: that entrepreneurship could help solve the most complex problems of our society. Today, everything we do at the Aavishkaar Group still centres on that belief, and Arohan, serving millions at the very last mile, remains among its most powerful expressions. As we look ahead, we do so with quiet confidence. We are prepared not only to navigate the risks that lie before us, but to seize the opportunities that will rise in their wake. We reaffirm our commitment to building an institution that is resilient, responsible, and relentlessly focused on creating lasting impact. Thank you for your continued trust and partnership. Warm regards, Vineet Chandra Rai Vice Chairman, Board of Directors Founder, Aavishkaar Group | 4 Annual Report | 2025-2026 Vice Chairman’s Address
MANAGING DIRECTOR’S Address MANOJKUMAR N NAMBIAR Managing Director It’s my privilege to connect with all of you once again through the FY 2026 Annual Report of Arohan Financial Services Limited. The year 2025-26 has been a very eventful one for us at Arohan – we completed 20 years of operation as a microfinance lender, ensured an increasing coverage of the portfolio under Credit Guarantee, while filing a DRHP for a possible listing, and achieving our highest ever portfolio outstanding with one of the best GNPA & NNPAs in the sector as of March 2026 ending. Arohan as of March 2026: Particulars As of March 2026 Portfolio Outstanding INR 7,426 Cr Borrowers ~ 2 million Branches 1,069 Districts 318 Operational States 16 Revenue INR 1,552 Cr TCI INR 122 Cr Net Worth INR 2,158 CAR 27.61% GNPA 1.13% NNPA 0.21% Rating ICRA A (Stable Outlook) CARE A- (Stable Outlook) Grading MF1 Following a difficult year for the microfinance sector in FY 2024-25, FY 2025-26 also began on a challenging note. Elevated slippages from regular accounts into delinquency, the intensive effort required to manage the 1-90 DPD buckets, and the focus on recoveries in the 90+ DPD portfolio left limited room for fresh business sourcing Greetings, 5 | Annual Report | 2025-2026
and disbursements. The sector stood at an outstanding portfolio of INR 3.75 lakh Cr, serving 78 mn borrowers as of March 2025. After witnessing a further contraction during the initial months of the year, it closed March 2026 with an outstanding portfolio of INR 3.25 lakh Cr, covering 64 mn borrowers. The first green shoots of recovery was noticed in September 2025 with the slippages moderating and disbursements picking up. This inflection was supported by a combination of factors, including GST rationalisation measures announced by the Union Government, a favourable harvest season, festive demand-led economic activity and the disciplined implementation of Self-Regulatory Organisation (SRO) guardrails across the industry. Encouragingly, these early green shoots strengthened through Q3 and Q4 of the financial year, translating into improved collection efficiencies, healthier portfolio performance, and a steady revival in disbursement activity across the sector. Against the backdrop of a challenging operating environment, our Business team remained steadfast in its focus on portfolio quality throughout the year, particularly during the difficult first half. As market conditions gradually improved, both our growth engines - Organic and Inorganic - gained significant momentum in the second half of the year. This resurgence culminated in our highest-ever monthly disbursement of INR 1,126 Cr in March 2026, helping us achieve a record net portfolio outstanding of INR 7,426 Cr as of year-end. A key contributor to this growth was our continued focus on deepening relationships with existing customers. Close to 40% of our borrowers continue to bank exclusively with us, and tailored offerings such as Arohan Khaas have played an important role in both strengthening customer engagement and expanding our portfolio while helping protect these customers from overleveraging. Customer discipline and engagement also improved through our sustained emphasis on centre attendance. Supported by Sahbhaagi, our customer loyalty programme, centre attendance levels reached 60% at the Company level by March 2026, with top performing locations reaching over 90%. Our strategy of serving customers across different stages of their financial journey continued to deliver results. Focused efforts on ArohanPrivilege (AP) for seasoned microfinance borrowers and Micro Enterprise Loans (MEL) for emerging entrepreneurs enabled us to tap new customer segments and diversify our portfolio. As of March 2026, AP and MEL portfolios stood close to INR 200 Cr and INR 300 Cr respectively. The Inorganic Business vertical also recorded a strong year, scaling to an outstanding portfolio of nearly INR 1,000 Cr with business written across term loans, Sourcing & collection and also Direct Assignment purchases, given our finer understanding of the business metrics as a lender ourselves. Our focus on strengthening and future-proofing our technology platform continues. Today, all our branches are enabled for Aadhaar-based e-KYC, providing a secure and reliable borrower authentication process. Artificial Intelligence (AI) is fast becoming a key theme in most businesses and we are happy to have started early – our Recovery vertical has been using AI for better coverage for results and our Customer Grievance Redressal Centre is now working to implement an AI solution which will help address the calls we receive from borrowers outside office hours even on holidays and also automate surveys with Arohi, our in-house bot. Our Business Analytics team has developed an AI voice-enabled bot which makes data available to business managers by voice commands. We are also piloting a new end-to-end Loan Origination System for our MEL business, strengthening our technology backbone to support the continued growth of this strategic segment. Our commitment to quality is reinforced by the strong partnership between our Risk, Credit, and Internal Audit teams. Working closely with the Business, these functions continuously analyse portfolio and operational trends, providing timely insights and actionable feedback to strengthen controls, address emerging risks, and enhance execution at the ground level. Risk is tasked with managing the risk limits set by the Risk Committee of the board which covers credit, operating, liquidity and reputational amongst others. Credit manages the underwriting policies across organic and the inorganic businesses including the credit administration process on a day to day basis. We have enlisted with NCGTC and today have CGFMU credit guarantee cover for more than 65% of our portfolio as of March 2026. Internal Audit helps us do an objective assessment of the adherence to operating policies across the field and non-field functions and also highlights control gaps to be covered. Every quarter, all our 1,050+ branches undergo risk grading, credit classification, and audit rating assessments. This comprehensive and rigorous review framework provides | 6 Annual Report | 2025-2026 Managing Director’s Address
7 | Annual Report | 2025-2026 a dynamic, real-time view of the health of our business, enabling timely interventions and informed decisionmaking across the network. Our close interactions with the RBI have helped us update the renewal loan & credit life cover process and also the microfinance pricing model from a viability and sustainability perspective. Arohan is probably the first in the microfinance sector to implement a risk-based pricing approach with a very attractive lowest rate of just 19.99% for the best and 24.24% for a new-to-credit borrower – this was possible as we launched the updated Nirnay 2.0, our own proprietary credit scoring model. We went through a full RBI Inspection in July-August 2025 resulting in a decent assessment and valuable suggestions for improvement on process & compliance. The RBI move to change the Qualifying/Non-Qualifying assets ratio to 60/40 is a welcome step and this will enable many MFIs like us to explore secured lending as part of the business model. The HR function played a key role in ensuring capacitisation across the year on field and non-field staff. The Performance Management focus with Performance Improvement Plans, half-yearly appraisals, updating the grading-banding levels, compensation benchmarking studies and also an employee satisfaction survey have been key elements of focus during the year. We have made positive progress on our diversity levels to 13.69% as of March 2026. Learning & Development remains to be a critical part of the new employee induction, productivity improvement plans, skill gap analyses across levels and functions and also capacity building efforts. Our L&D function has introduced a short learning-snippet initiative to reach out to the field officers in a form and media they feel comfortable in. We are proud to be recognised as one of the most active employers in Eastern India in partnering with BOPTER under the Government’s Apprenticeship Programme, reflecting our commitment to developing future talent and creating meaningful employment opportunities. Our Administration team plays a critical role in ensuring a safe, healthy, and efficient workplace for employees while driving cost optimisation across our network of 1,100+ locations, including our Head Office in Kolkata. Complementing these efforts, initiatives like the “Arohan Swachh Abhiyaan” promotes a culture of hygiene, cleanliness, and workplace pride by recognising and rewarding branches that demonstrate exemplary standards. The past year was marked by tight liquidity and constrained debt availability across the microfinance sector. Despite these challenges, we remained well-funded throughout the year, securing the resources required for growth at competitive rates. Our borrowing mix evolved in line with market conditions, with increased participation from private sector banks and structured financing solutions from NBFCs, particularly to support nonqualifying assets. Recognising the sector’s critical role in extending formal credit to underserved communities, the Union Government introduced a INR 20,000 crore Credit Guarantee Scheme in Mar’26 to facilitate bank lending to MFIs, with dedicated provisions for small and mediumsized institutions. We intend to leverage this initiative both to establish new lender relationships and deepen existing partnerships, thereby further diversifying and strengthening our liability franchise. Another significant development during the year was the progress made on overseas funding avenues, including engagements with international lenders for Non-Convertible Debentures (NCDs) and External Commercial Borrowings (ECBs), which will help broaden our funding base and support future growth. We are delighted to have been re-viewed on our Quality certifications – ISO 9001 and ISO 27001 for our Internal Audit and IT platform from BSI, India. Our Corporate Social Responsibility (CSR) activities works with a dual approach - working closely with Aavishkaar Foundation on entrepreneurship development in eastern Uttar Pradesh and the community level activities spanning health camps, hearing check for new borns, value-based education for school children and disaster relief have been received well on the ground. Since the inception of our CSR journey in 2016, we have positively impacted close to 1 mn beneficiaries. Arohan was recognised at The Eastern India Leadership Awards, 2025 for its Innovative CSR practices. We are fortunate to have investors like FMO & IFU who have supported us with grants to finetune our ESG strategy and also work on a Climate Impact document – this helped us publish our second ESG report as of March 2025. The Strategic Initiatives unit at the Corporate Office continued to play a pivotal role in tracking key performance indicators, driving analytical deep-dives on business issues, and evaluating new growth opportunities while supporting informed decision-making across the
| 8 Annual Report | 2025-2026 organisation. The Corporate Communications & Public Relations team strengthened both internal and external stakeholder engagement through communication initiatives, amplifying the Company’s achievements, strategic priorities, and brand presence. Our board engaged with the management in a detailed strategy discussion in November 2025 looking at the market trends, financial landscape, opportunities and what we should do build a sustainable and impactful business. This culminated in the new “Vision 2030 – to impact 20 million lives by 2030” which guides us on the way forward. Arohan Impact: Particulars Unit Arohan’s Impact Since Inception Cumulative Disbursements since inception INR Bn 473.98 Total accounts disbursed since inception # 1,40,39,734 Unique lives impacted till date since inception # 70,58,671 Lives insured through safety-net financial products since inception # 2,36,59,876 UNFCC certified emission reductions (CERs) generated tCO2 1,78,437 Employees joined till date since inception # 46,882 People benefited through a unique income protection plan since inception # 1,23,46,365 Lives touched through social interventions since inception # 9,23,604 Building on the progress achieved during FY 2026, the year ahead will be pivotal in advancing our long-term growth ambitions. As part of our efforts to proactively strengthen the Company’s net worth and position Arohan for its Vision 2030 aspirations, the Board approved the exploration of a public listing. Accordingly, we successfully filed our Draft Red Herring Prospectus (DRHP) on May 15, 2026, setting in motion the next phase of our evolution as we prepare to access the public capital markets. I was honoured to be selected as the Chairperson at the Association of Microfinance Institutions, West Bengal (AMFI-WB) last year, one of the oldest MFI associations in one of the biggest markets in the country while I complete my 3rd three-year term on Micro Finance Industry Network (MFIN), the sector SRO’s Managing Board in June 2026. I would like to place our sincere gratitude to the millions of borrowers who have given us a chance to serve them, our investors for their confidence, our promoter group for their belief in the business, our regulator RBI for their support to microfinance, our lenders for the debt leverage they provide, MFIN our active SRO for the sector, our auditors for their work, our esteemed board of directors for their encouragement and last but not the least, thousands of our employees for the passion and hard work in the business. I am privileged to have been the MD of the company since 2012 Look forward to your continued support, Warm regards, Manojkumar N Nambiar Managing Director Managing Director’s Address Mr. Manojkumar N Nambiar, Managing Director of Arohan Financial Services Limited and the Chairperson of AMFI-WB, was present alongside other eminent dignitaries at the lamp lighting session of the 10th Eastern India Microfinance Summit 2025 in Kolkata.
9 | Annual Report | 2025-2026 CORPORATE Information Mr. Manojkumar N Nambiar Managing Director Mr. Milind Ramchandra Nare Deputy Chief Executive Officer and Chief Financial Officer Mr. Shailesh Kumar Chief Business Officer Mr. Anirudh Singh Thakur Company Secretary and Chief Compliance Officer Mr. Ranjan Das Chief Risk Officer Mr. Abin Mukhopadhyay Head of Internal Audit and Vigilance Mr. Arvind Murarka Chief Information Officer Ms. Kanchan Banerjee Head of Human Resources, Training and Development, Administration and CSR Ms. Sharoni Pal Head of Credit Mr. Ketan Agrawal Deputy Chief Financial Officer Mr. Vinod Kumar Pandey Head of Central Operations MANAGEMENT REPRESENTATIVES Mr. Dinesh Kumar Mittal Chairman and Non-Executive Independent Director Mr. John Arunkumar Diaz Non-Executive Independent Director Mr. Ulhas S Deshpande Non-Executive Independent Director Mr. Jose J Kattoor Non-Executive Independent Director Mr. Kummamuri Narasimha Murthy* Non-Executive Independent Director Mr. Vineet Chandra Rai Vice Chairman and Promoter Nominee Director Mr. Anurag Agrawal Promoter Nominee Director Mr. Wilhelmus Marthinus Maria Van Der Beek Non-Executive Nominee Director Mr. Stephen Dongwon Lee*** Non-Executive Nominee Director Mr. Sri Radha Ramana Saripalli** Non-Executive Nominee Director Mr. Nitish Chawla Non-Executive Nominee Director Ms. Karina Isabel Alva Alfaro Non-Executive Nominee Director Ms. Rupa Rajul Vora Non-Executive Nominee Director Mr. Manojkumar N Nambiar Managing Director BOARD OF DIRECTORS Note: * The appointment of Mr. Kummamuri Narasimha Murthy was regularised by the shareholder at the Extra-Ordinary General Meeting held on April 22, 2025. ** Mr. Sri Radha Ramana Saripalli was appointed as a Nominee Director on the Board of Directors of the Company with effect from May 23, 2025. *** Mr. Stephen Dongwon Lee has resigned from his directorship in the Company with effect from May 08, 2026.
| 10 Annual Report | 2025-2026 REGISTERED AND CORPORATE OFFICE PTI Building, 4th Floor, DP 9, Sector 5, Salt Lake, Parganas North, Kolkata 700 091 West Bengal, India Tele: + 91-33-4015-6000 E-mail: compliance@arohan.in Website: www.arohan.in SECRETARIAL AUDITOR MR & Associates Company Secretaries Registration No: P2003WB008000 46, B.B. Ganguly Street, 406, Kolkata – 700012, West Bengal CORPORATE IDENTIFICATION NUMBER U74140WB1991PLC053189 REGISTRAR AND TRANSFER AGENT MUFG Intime India Private Limited (Formerly Link Intime India Private Limited) C-101, Embassy 247 L.B.S. Marg, Vikhroli (West) Mumbai 400 083, Maharashtra, India STATUTORY AUDITOR B S R & Co. LLP Chartered Accountants (Registration No-101248W/W-100022) 14th Floor, Central B Wing and North C Wing, Nesco IT Park 4, Nesco Center, Western Express Highway, Goregaon (East), Mumbai - 400063 Corporate Information
11 | Annual Report | 2025-2026 Purpose Progress powering Our Mission, Vision and Values At Arohan, progress begins with people and is sustained through purpose. The collective mindset, actions, and integrity of our teams shape how we respond to an everevolving ecosystem and how we deliver meaningful impact on the ground. Our culture is deeply rooted in our core values, which guide responsible lending, ethical conduct, and inclusive growth. These values empower our leaders and teams to consistently translate intent into action, advancing our Mission and Vision with clarity, commitment, and accountability. Together, they ensure that progress is not abstract, but visible in every hand we touch, through purpose and commitment. MISSION To empower the under-served households by offering a range of financial services, in a manner sustainable for all stakeholders. VISION To impact over 20 million lives by 2030. To be among the Top 3 MFI players, serving nearly 5 mn households and being a preferred place to work for our employees.
| 12 Annual Report | 2025-2026 CORE VALUES (ETHICS) EMPLOYEE ENGAGEMENT Arohan treats its employees as a major stakeholder and hence its processes and systems are designed to ensure employee satisfaction, development and high morale. TRANSPARENCY Arohan’s products and processes are transparent to its clients such that the information communicated to them is clear, sufficient and timely in a manner and language clients can understand so that clients can make informed decisions. It is also transparent in its communication to, and transactions with all other stakeholders, and employees. HONESTY AND INTEGRITY Led by exemplary governance, Arohan maintains high integrity in its delivery, products and processes. Arohan has zero tolerance for unethical practices. It strives to behave with honesty and integrity in all its internal and external communication, and dealings with all stakeholders. CUSTOMER CENTRICITY Since customers are considered important stakeholders, Arohan’s products and processes are designed keeping customer needs and realities in mind. Arohan strives to serve customer needs in an effective and efficient manner and behave in a dignified and respectful manner with its customers at all times. INNOVATION Arohan strives to maintain a creative culture in the organisation, where employees are encouraged to learn and innovate in their day to day work, while adhering to Arohan’s standards of business and conduct. Also, product, process and business model innovation are integral to Arohan. SHAREHOLDER VALUE FOCUS Arohan recognises its shareholders to be an important stakeholder whose interests it strives to protect, and to whom it seeks to deliver value by focusing on sustainability, profitability and growth of the business. Mission, Vision and Values
13 | Annual Report | 2025-2026 Our Business Verticles Credit Solutions that Enable Growth at Every Step In a rapidly evolving economic landscape, Arohan remains focused on identifying opportunities that better serve customers while safeguarding their interests at every step. By continuously strengthening processes, advancing a sustainable lending model, and diversifying its offerings, Arohan ensures that the varied and emerging credit needs of customers are met with care and responsibility. Anchored in a clear strategic roadmap, our operations are structured around four key business verticals that enable focused growth and deeper outreach. These verticals empower us to deliver innovative, accessible, and customercentric credit solutions across segments. At the core of Arohan’s business is our commitment to providing accessible credit to individuals at the bottom half of the socio-economic pyramid. Through our joint liability group model, we offer a range of financial products and services for microfinance customers. The Saral product family—which includes Saral New-to-Credit, Saral Use-to-Credit, and Saral Repeat—caters to diverse borrower profiles with loan sizes ranging from INR 25,000 to INR 1,25,000. With repayment tenures typically between 24 to 30 months, the product line emphasises flexibility and customer-centricity. This evolution of the Saral suite reflects Arohan’s broader commitment to financial inclusion with responsibility, supported by robust digital platforms, data-driven insights, and a long-term view of the customer lifecycle. Guided by Vision 2030 - to positively impact 20 million lives by 2030, Arohan’s diversified approach is designed not just to expand business, but to create meaningful progress in every hand we serve. TAILORED ORGANIC CREDIT SOLUTIONS
| 14 Annual Report | 2025-2026 Arohan takes pride in offering a range of solutions to meet the diverse needs of microfinance customers through our MFI Alliances vertical. This includes an innovative alliance-based model, designed to expand access to credit and support the growth of the retail borrowers including microfinance sector. Through this vertical, Arohan extends term loans ranging from INR 1 Cr to INR 100 Cr to smaller MFIs apart from other NBFCs, enabling them to build and scale their microfinance portfolios. Additionally, under the exclusive Sourcing & Collection (S&C) arrangements, partner MFIs establish dedicated branches to source and manage microfinance loans on Arohan’s behalf. These loans are booked under Arohan’s name and governed by its underwriting standards, ensuring quality and consistency. In return, partner institutions receive a share of the interest collections, creating a mutually beneficial, capital-light model that fosters portfolio expansion without direct capital investment. We also continue to evaluate the purchase of loan portfolios originated by NBFCs through direct assignment and securitisation transactions. Our ArohanPrivilege platform offers a seamless digital loan experience, designed specifically for our valued customers. Through the ApnaArohan app, customers can seamlessly access loan services, including application and repayment, through a fully technology based and cashless journey. The platform enhances customer convenience by minimising dependency on physical processes, while maintaining robust credit and risk assessment frameworks. Following a hybrid engagement model, both new and existing customers can initiate loan applications digitally, supported by field-level facilitation from our Customer Service Representatives (CSRs). This approach combines the efficiency of technology based processes with on-ground validation, ensuring both convenience and reliability. Recognising the vital role that micro and small enterprises play in India’s economy, Arohan offers tailored credit solutions designed to meet the unique needs of small entrepreneurs. Through its Micro Enterprise Loan Programme, the Company extends loans ranging from INR 50,000 to INR 5 lakhs, providing timely working capital support to help businesses grow and sustain their operations. By closely understanding the challenges faced by microentrepreneurs, Arohan delivers flexible, need-based financing that empowers them to strengthen their enterprises and progress with confidence. MFI ALLIANCES FOR BROADER ACCESS AROHANPRIVILEGE: TECHNOLOGY-BASED LENDING OFFERING ENABLING MICRO-ENTREPRENEURS WITH FLEXIBLE CREDIT SOLUTIONS Business Verticals
15 | Annual Report | 2025-2026 PRODUCTs Progress that enable for Every Need Our operations are focused on customer centricity, supported by a range of income-generating and financially inclusive offerings aimed at meeting the diverse needs of financially underserved and unserved customers. Our product portfolio comprises core microfinance products, including the Saral loan and micro-enterprise loans (“MEL”), as well as certain secondary, Cross Sell products offered exclusively to our core loan product customers to address their requirements for both financial and non-financial products. These products support livelihood enhancement, working-capital requirements and essential household needs. Our financial offerings include credit offerings and insurance products, while our non-financial offerings include cross selling of products such as solar lamps, consumer durables, kitchen appliances, bicycles and other household items through partner agencies. These products can also be financed by us through secondary loans for eligible customers. Our credit offerings comprise income-generating loans and loans extended for essential household purposes. Our insurance offerings include life and health insurance products issued and underwritten by certain insurance companies in India, which are distributed by us pursuant to tie-up arrangements with such insurers. In addition to our core organic offerings, we also undertake sourcing and collection arrangements, provide term loans to NBFCs and engage in direct assignment transactions with NBFCs.
| 16 Annual Report | 2025-2026 NAME CUSTOMER PROFILE LOAN SIZE LOAN TENURE Saral Catering to women residing in low income areas, generally involved in trade & services. INR 25,000 – INR 1,25,000 24 - 30 months Micro Enterprise Loans Loans to address the working capital needs of small businesses operating out of authorised market places or clusters of shops organised under a trader’s association. Includes predominantly male customers. INR 50,000 - INR 5,00,000 24 - 36 months CORE PRODUCTS NAME MAXIMUM AMOUNT OF LOAN / CREDIT LIMIT / INSURANCE COVERAGE LOAN TENURE Cross Sell Loans Upto value of active Primary Loan Disbursement amount associated with customer, in any given cycle 03-24 months SECONDARY PRODUCTS NAME CUSTOMER PROFILE LOAN SIZE LOAN TENURE ArohanPrivilege Gold Standard Microfinance Customers INR 20,000 - INR 1,00,000 05 - 30 months DIFFERENTIATOR SERVICE PRODUCT CATEGORY NAME OF LOAN/PRODUCT MAXIMUM AMOUNT OF LOAN / CREDIT LIMIT / INSURANCE COVERAGE TERM (MONTHS/WEEK) Insurance (offered through tie-ups under corporate agency with certain Indian insurance companies) Term Life Insurance Coverage is equal to loan amount disbursed to customer Loan Term Hospicash INR 1,000 per day for normal hospitalisation up to 30 days and INR 2,000 per day for ICU hospitalisation up to 20 days in a year. Riders include Personal Accident benefit of upto INR 2 Lakh for permanent full and permanent partial disability, Convalescence benefit of INR 2,000 Critical Illness cover of INR 60,000 and Telemedicine cover for 6 family members. 24 months Shopkeeper Insurance There are 3 variants available, each comprising of a specific combination of the below features: Stock – INR 2,04,500 / INR 3,00,000 / INR 4,09,000 Content - INR 2,04,500 / INR 3,00,000 / INR 4,09,000 Burglary – INR 4,09,000 / I NR 6,00,000 / INR 8,18,000 Terrorism - INR 4,09,000 / INR 6,00,000 / INR 8,18,000 12 months Loans to NBFCs Term Loans INR 1 Cr - INR 100 Cr 12 - 36 months OTHER PRODUCTS ● ● ● ● Product Offerings
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