ACROSS

THE PAGES
Corporate Overview Statutory Reports &
Financial Statements
Corporate Snapshot 01
Milestones 04 Director’s Report 38
Presence 06 Corporate Governance Report 59
Managing Director’s Statement 08
Business Highlights 14
Customer Testimonials 16
Financial Statements 73
Management Discussion & Analysis 18
Risk Management 22
Our People Management Competence 24
Notice 169
Our Technology Competence 28
Corporate Social Responsibility 30
Awards and Accolades 34
Board of Directors 36

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Disclaimer
This document contains statements about expected future events and
financials of Aye Finance Private Limited (‘The 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 may not prove to be accurate. Readers are cautioned not
to place undue reliance on forward-looking statements as several 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 this Annual Report.
Corporate Snapshot

UNLOCKING POTENTIAL.
UNLEASHING PROGRESS.
Over the last decade, Aye Finance has transformed Our accomplishments are not just about providing
the landscape of micro enterprise lending in India. financial services. We take pride in being an
Championing the growth and empowerment of innovative, tech-forward company that goes beyond
bottom of the pyramid businesses throughout meeting to anticipating the distinct needs of our
the nation. Our mantra ‘Unlocking Potential. customers, equipping them with the resources that
Unleashing Progress.’, encapsulates our mission enable their businesses to thrive.
to drive financial inclusion and fuel the growth
We do not intend to rest on our laurels , having
of 60 million micro enterprises that form the
marked a decade of significant growth and industry
backbone of the Bharat economy.
leadership, we continue to value the industry
Our innovative strategy revolves around offering standards with eyes on greater expansion and
customised working capital loans to micro impact. Thereby unlocking the potential of countless
businesses, with turnovers ranging from ` 15 more businesses, while unleashing progress across
lakhs to ` 1 crore. Utilising advanced technology Bharat.
and proprietory cluster based credit assessment
As we prepare for the next phase of our journey, we
techniques, we have successfully reached
remain focussed on our mission to drive financial
entrepreneurs of various clusters such as (sports
inclusion, empower grassroots businesses, and
goods, salon, wood work, bangles, tailoring,
contribute to the economic progress of India.
groceries etc.) which were traditionally neglected
‘Unlocking Potential. Unleashing Progress.’ is our
by mainstream financial institutions.
goal, our motivation, and our promise to the future!
EMPOWERING SMALL BUSINESSES TO
DREAM BIG SINCE 2014…
Our Vision Our Mission
Aye’s vision is to be a leading finance To provide innovative
company in India, admired by Customers, and customer-centered
Employees, Investors and Regulators financial services to micro
for its Service and Innovations. and small businesses
through knowledgeable
team, effective technology
and robust processes to
power their growth into
the new-age India.
Our Values

Innovation
Be curious. Explore. Pioneer.

Trustworthiness
Be fair. Keep promises. Be genuine.

Social Impact
Make a difference. Give back. Touch lives.

Being the best

Learn. Mentor. Onwards together.

Customer Commitment
Think customer. Be proactive. Exceed expectations.

2 Annual Report 2023-24

 Corporate Overview

Salient Business Numbers

` 3,941 crore ` 1,072 crore ` 161 crore

Disbursement Revenue PAT

8 21 7,000+
Total Equity Partners Number of States and Number of Employees
Union Territories

4.57 lakhs ` 1,000 crore ` 310 crore

Number of Active Clients Total Equity Raised Equity Raised in 2023-24

Aye Finance Private Limited 3

Milestones
UNLOCKING MILESTONES.
ACHIEVING CONSISTENT GROWTH.

2014 2016
Raised seed Raised Series B equity from LGT,
funds Accion and Elevation Capital

Opened the first Entered into South India by opening

branch in Delhi branches in Karnataka and
Tamil Nadu
Expanded to
Uttar Pradesh Commenced digital journey
through an automated loan
origination and decision process

2015
2013 Raised Series A

Received NBFC
license
funding from Accion
and Elevation Capital 2017
Reached the landmark
Disbursed loans worth
of 33,000+ customers
` 290 lakhs
Crossed AUM
Opened 16 branches
of ` 341 crore
and expanded to
Rajasthan, Punjab and
Haryana
2018
Raised Series C Equity round
of ` 147 crore which was led
by Capital G, Alphabet Inc’s
independent growth fund
Reached the landmark of 100
branches across 18 states
Ranked among the top
20 in BFSI segment by
‘Great Place to Work’

4 Annual Report 2023-24

 Corporate Overview

2019 2023
Raised Series D Raised Series F equity of ₹ 310
equity of ` 234 crore which was led by BII, UK’s
crore which was development finance institution
led by Alpha Wave
Reached the milestone
Got classified by the figure of ` 100 Billion in
RBI as a Systemically loans disbursed to MSMEs
Important NBFC
Reached the
2021
Branch network
mark of 2,00,000+ crossed 300 mark
customers, ` 1,597
crore of AUM and
2,700+ employees
Awarded the SME
Financier of the Year - Asia
2024
Serving 9,00,000+
(Gold) By SME Finance customers
Embedded data Forum (World Bank)
science and 478 branches
artificial intelligence in 21 states
as core way of doing
business Frost & Sullivan

2022
recognised Aye as
the ‘Technology
Ranked 2nd among Innovation Leader in
the 100 Best the Indian Inclusive
Companies to Work Fintech Solution

2020 in India by GPTW

Opened 86 branches
Industry for 2024’

Successfully raised
` 210 crore in Series bringing the total
E equity Round in the number of branches
Covid environment to 398 in 20 states

Continued to expand Team size of 5,000+

and reach the mark employees
of 200 branches

Aye Finance Private Limited 5

Presence
UNLOCKING POTENTIAL OF MICRO ENTERPRISES.
TAILORING INNOVATIVE
SOLUTIONS.
We have rapidly expanded to 478 branches across 21 States and
Union Territories in just 10 years. We started our journey fuelled by a
vision to bridge the financial gap for micro-enterprises. Through the
years, we have evolved into a trusted partner for the MSMEs at the
micro scale across the nation. We use the best of physical field
presence & technology to deliver outcomes that are benchmarked to
the best.
We enjoy a robust
presence across…

21 478 180+
States and Union Territories Branches Clusters

Our Clusters
Horizontal
Vertical Clusters
Clusters
Grocery Shop Dry Cleaning Men’s shoes Glasswork Woodwork

Tailoring Leather Goods Iron Works Pottery Silver Ware

Salon Sports Goods Handicrafts Lac Bangles Power loom

Eatery Scientific instruments Agri Tools Hosiery Pin manufacturing

Beauty parlor Rugs & carpet Women’s shoes Garment

and more

6 Annual Report 2023-24

 Corporate Overview

West North
Branches Branches

119 154

0.2%
J&K

1.2%
HP
4.4%
PB 1.4%
UK
4.8%
0.4%
HR
DL

11% 1.3%
RJ UP
9%
BR

4% 4% 4%
GJ 6.3% JH WB
MP

1.5% 3.7%
CG OR
East
8.3%
MH Branches

3% 100
TL

4%
7.5% AP
KA

7.5% South
TN Branches

105

Disclaimer: This map is a generalised illustration only for the ease of the reader to understand the locations, and it is not intended to be used for reference
purposes. The representation of political boundaries and the names of geographical features/states do not necessarily reflect the actual position. The
Company or any of its directors, officers or employees, cannot be held responsible for any misuse or misinterpretation of any information or design thereof. The
Company does not warrant or represent any kind of connection with its accuracy or completeness.

Aye Finance Private Limited 7

Management Message
MANAGING DIRECTOR’S
STATEMENT

Our lending to these

micro businesses has
helped unlock their
potential and has thus
strengthened the business
backbone of the nation.

Dear Valued Stakeholders,

I am delighted to present
our Annual Report for 2023-
24. This has been a year of
significant achievements and
robust growth aided by the
tail wind of a relatively benign
market environment. We had
navigated honourably through
the turbulence of the years
affected by Covid pandemic
and this resilience and
strength has made us reap
the benefits of this benevolent
year. We grew to AUM of ₹
4,461.97 crore in 2023-24
from ₹ 2,721 crore in 2022-
23 that is 64% growth from
last year, while the operating
expenses grew only by 30%
and the GNPA remained range
bound and ended the year
at 3.19 %. This has resulted

8 Annual Report 2023-24

 Corporate Overview

in our PAT growing from ₹ 53.79 crores in scale businesses are transitioning to the
2022-23 to ₹ 161.13 crores for 2023-24 – formal economy at an impressive pace.
this is a 3x growth. There is encouraging This is just the start of this trend and in
news from every aspect of the business the coming years, the world may soon
and we are using this to strengthen our witness an unprecedented transformation
reserves for possible adverse times. of the excluded communities of Bharat.
Aye is well entrenched in this part of the
In our ten years since inception, we have
market. Our ability to underwrite these
continually focused on transformational
thin file clients businesses using a cluster
impact on the MSMEs of micro scale.
based income forecast method and our
Our lending to these micro businesses
automation of processes complements
has helped unlock their potential and
our presence in 478 branches in 21
has thus strengthened the business
States. This opens up a huge opportunity
backbone of the nation. As India moves
to achieve our vision to be an admired
confidently on its path of rapid GDP
leader in the industry.
growth, the 67 Million micro and small

PORTFOLIO MIX

39% 61% 40% 60%

Unsecured Secured Unsecured Secured
(Property and (Property and
Working Working
Assets) Assets)

FY 22 FY 24

CUSTOMERS EXPANSION IN 10 YEARS

8,47,188

5,77,023

3,96,766

2,90,201
2,38,024

1,25,573

423 4,562 17,435 54,709

FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24

Aye Finance Private Limited 9

CUSTOMERS
businesses, typically in service sector, do not have
Our active customer base has grown to over 470,000 micro
adequate working assets or machinery to cover the
enterprises as of March 2024. We have made credit
loan amount.
accessible to these micro businesses that have
traditionally been overlooked by the formal financial Through our ‘not for profit’ subsidiary – Foundation for
institutions. Our customers have businesses from all Advancement of Micro Enterprises (FAME) , we have
sectors of commerce – manufacturing trading, service and helped micro enterprises become more robust and
allied agri. The base of our customers are well distributed efficient through improved production techniques,
over 21 States with 32% in North, 22% in South and 21% better quality of produce , superior marketing support
and 25% respectively in East and West. Our focus on and efficient financial management. FAME has brought
avoiding geographic concentration has not only made us our transformation impact in lives of over 1,18,0000
immune from state level events but has also benefitted a beneficiary businesses. Some of the striking initiatives
wide gamut of businesses across the nation. last year from FAME were:

Our customer centric approach is rooted in deep Collaboration with Hindustan Unilever Limited
understanding of the unique needs of these micro scale (HUL) with a donation of ₹ 4.6 crore for Dairy
MSMEs. Our offering of property based as well as Development Project
hypothecation based loans illuminates this approach of a
complete product line for our customers. In the last year 22,000 women entrepreneurs trained
we saw a trend of increase in customers who sought
₹ 3,47,32,564 income generated
larger loans to revitalise their businesses post the Covid
for our beneficiaries
years. This has enabled our business loans against
property to increase to 11%. About 49% of our The extensive customer connect and the quality of
Hypothecation loans are secured with adequate value of facilitation of their businesses has continued to
working assets, finished goods and machinery, while the delight us with high satisfaction score. Last year the
remaining 40% of our portfolio is unsecured hypothecation monthly customer surveys found that over 94% of our
loans where customers rated our services as very good.

BRANCH EXPANSION IN 10 YEARS

21% 478
East 32%
North
395

309

25% 211
West
173
22%
South
104
72
33
5 16

FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24

10 Annual Report 2023-24

 Corporate Overview

CUSTOMER SATISFACTION SCORE

FY23 90% FY24 94.07%

OPERATIONS AND TECHNOLOGY CUSTOMER APP SCREENSHOTS

Alongside the branch based origination and
servicing, we have invested substantially in
establishing strong capability in technology
and process automation. This has emerged
as a key competence in:

Improving business efficiency

Preventing operating losses, and
Managing underwriting complexity

We have continued to build on this capability

and as an outcome, we are well automated,
through our Loan Origination, Loan
Management, Collection Management and
ERP workflows. Our systems are integrated
with APIs that provide seamless access to
government sites that validate customer
credentials, provide banking and credit
history based on due customer consent. The
entire customer loan application and
disbursement journey is paperless. Even the
Loan agreements now signed digitally by
over 90% of our customers. Our customer
app allows customers to have direct access
to their crucial loan details and repayment We grew to AUM of ` 4,461.97
reminders.
crore in 2023-24 from ` 2,721 crore
The technology and automation programs
are complemented by our in-house Data in 2022-23 that is 64% growth
Science expertise. Models like ‘likelihood of
bounce’, ‘propensity for early clearance of from last year, while the operating
overdues’, credit quality score for repeat as
well as new customers – are some of the expenses grew only by 30%.
models that have been deployed after
extensive testing against our rich database
of micro scale MSMEs.

Aye Finance Private Limited 11

We have unique underwriting templates for over 180 We delivered over 1,20,000 hours of training on various
types of business clusters that have been tested over the skills and values that are required for a competent and
years. The use of automation has enabled us to handle trustworthy work team. The exceptional efforts of
this complexity without requiring specialised human many of our champions were recognised through over
expertise in these varied business clusters. This makes 9,000 awards and over 1,100 job advancements.
the process efficient and reduces the risk of human
We have a team of Leaders who are experienced and
errors.
have demonstrated their ability to drive the
EMPLOYEES organisation to high benchmarks of achievement while
upholding the highest levels of values and integrity.
Our excellent progress towards our vision, has been Many of our leaders have won awards and recognition
powered by our employees. They have shown in the year, from the industry for their thought
tremendous heart as we overcame a variety of leadership and high achievements. Our Leadership and
challenges and built a special place in the minds of our our team have carried us admirably forward on our
customers. mission and we shall continue to build the engagement
We are a team of 7,000+ employees as of March 24. We and trust of our workforce to help create value for all
donot use any third party of DSA agents for origination. stakeholders.
Reliance on our own employees has borne good returns Our employee focus delivers a high level of employee
for our business – the quality of sourcing has been engagement. We have been ranked in the top 10 best
maintained at high levels and there are very rare workplaces by ‘Great Place to Work Institute. In the
instances of customer mis-selling or compromise of our year 2023-24, we have been ranked 6th all over India.
process discipline.

GPTW TRUST INDEX RESULTS

Aye’s Overall Trust Index Score : 97/100

India Top 50- Best Companies to Work For Trust Index Score : 90/100

97
90
Credibility T
R 97
Respect U 90
S
96
Fairness T 88

Pride 92
97

Camaraderie 96
90

75 80 85 90 95 100

Aye Finance P Ltd.

India Top 50 Best Companies to Work For

12 Annual Report 2023-24

 Corporate Overview

KEY OUTCOMES & PLANS

2023-24 saw our business scale many high points –

We raised ₹ 3,800 crore in debt

We have been ranked
We raised ₹ 310 crore is new equity in our Series F
round led by BII in the top 10 best
We disbursed ₹ 3,941 crore- in loans through the year.
workplaces by ‘Great
1.84% return on assets alongside an average of 2.8%
D/E (debt/equity) ratio for the year. Place to Work Institute
We got a corporate rating upgrade to A

We received the prestigious Frost and Sullivan award

three years in a row. In
for Technology Innovation Leader in the Indian
Inclusive Fintech Solution Industry for 2024, Inclusive
the year 2023-24, we
Finance India Award and Best MSME Financing
Institution Award by BW Businessworld.
have ranked 6th among
We were ranked 6th among large enterprises, as a Great
Place to work.
the best companies
Our CSR activities under FAME, reached the milestone to work for in India.
of impacting over 1,00,000 micro enterprises through
their efforts to improve skills and capabilities of micro
enterprises

uniquely positioned to address the needs of MSMEs of

micro scale. As the MSMEs move towards formalisation of
FY24 (DEBT RAISED) their financial setup, their needs for loans against
hypothecation will be in focus and this will benefit our
business.

Our strategic focus shall remain on the target segment of

MSMEs with micro scale. By exceptional execution of
basics, we have made our business robust. We shall
42% 42%
NBFCs and Bank continue to raise our benchmarks in many salient areas of
other FIs lending. We will see the deepening of AUMs in each branch
and this will give us a much improved Cost to Income
8% metrics. The focus on prudent underwriting has enabled
DFI the scaleup of our business and we shall continue to stay
true to our underwriting discipline. The field collections
capability had been enhanced during Covid years, we have
continued to use this strength as our business has grown
We have revitalised our business and team during the year.
rapidly in the past two years. Automation and appropriate
While we have put behind, the memories of the Covid
use of Data science models will work hand in hand with
disruption, the learnings of those times have unmistakably
our organisational processes.
made us a better business. The focus on improving
employee productivity, optimally managing expenses and I look at the coming year with a lot of excitement as we
leveraging every opportunity to enhance revenues with target to deliver a consistent top-notch performance.
balanced risk – these have led us to outstanding
profitability for our business this year. Best Regards,

Through our capability to offer loans secured by property Sanjay Sharma

or through hypothecation of business assets, we are Managing Director

Aye Finance Private Limited 13

Business Highlights
GROWING WITH INCLUSIVITY.
CREATING VALUE WITH DILLIGENCE.
CAPITALS ENGAGED MEASURES

Financial Capital Total Debt

Our robust capital base and diverse funding ` 3,800 crore
sources empower us to meet our clients’ credit
Equity Raised
needs effectively.
` 310 crore

Intellectual Capital 100% Investments

Our intangible assets encompass our brand, paperless loan in data science and
reputation, technology-driven infrastructure disbursements analytics
and strategic partnerships. These elements en-
able us to manage risks effectively and deliver 92%
exceptional customer service. ACH registration

Branches Active Customer Base

Physical Capital 478 4.57 lakhs
Our extensive local presence, combined with
a digital platform, allows us to serve under- States and
served micro enterprises effectively. Union Territories
21

Workforce Strength Employee

Human Capital
7,000+ training hours
We leverage our employees’ skills and experi-
122K hours
ence to provide tailored financial solutions to Employee Awards
our customers. 9,000

Loan to first time clients

Social and Relationship Capital
Our relationships with stakeholders, especial-
40%
ly in the communities where we operate, are FAME has
central to our approach. 1,18,000 beneficiaries

Natural Capital
Our use of natural resources—such as energy Ensured the reduction of paper
and water—and our impact on the climate, usage and effective water
along with the measures we take to mitigate management across branches
these effects.

14 Annual Report 2023-24

 Corporate Overview

Financial Overview
Revenue (` in crore) EBITDA (` in crore) PAT (` in crore)

643.34 1,071.75 280.81 568.93 53.79 161.13

2022-23 2023-24 2022-23 2023-24 2022-23 2023-24

67% 103% 200%

Growth compared to 2022-23 Growth compared to 2022-23 Growth compared to 2022-23

PAT Margin (%) ROE (%) Debt Raised (` in crore)

8.36 15.03 7.72 17.03 2,044 3,800

2022-23 2023-24 2022-23 2023-24 2022-23 2023-24

6.67% bps improvement 9.93% bps improvement 86% improvement compared

compared to 2022-23 compared to 2022-23 to 2022-23

ROCE (%)

8.79 11.71

2022-23 2023-24

2.93% improvement
compared to 2022-23

Aye Finance Private Limited 15

Customer Testimonials
EMPOWERING ENTREPRENEURS.
PROPELLING PROGRESS.
Weaving a Brighter Future through Shakti Loans
Hameeda, a small bedsheet weaver from Sardana,
Gomtinagar, faced immense challenges after losing her
husband, struggling to raise two children and keeping her
fledgling business afloat. Traditional banks rejected her
loan request, deeming her enterprise too young for loans.
But everything changed when our loan advisors introduced
her to the Shakti Loan, specifically designed for women
entrepreneurs like her.

With the Shakti Loan, Hameeda upgraded her equipment,

expanded production, and transformed her business. The
increased profits allowed her to invest in her children’s
education, securing a brighter future. Today, Hameeda is not
just a weaver of bedsheets but a symbol of hope, inspiring
her community with her resilience and success.

Empowering Sumit’s Dream of Business Expansion

Sumit’s journey with us has been nothing short of
transformative for his business. Initially, he relied on loans
from money lender but the high interest rates posed a
constant challenge. This all changed when one of our Loan
Advisors approached him, taking the time to explain the
benefits of their low-interest loans and how partnering with
Aye Finance could elevate his business.

Seeing the potential, Sumit decided to take a loan from Aye

Finance, a decision that quickly proved to be one of the
best he ever made. The lower interest rate allowed him to
reinvest in his business, resulting in significant growth and
profitability. For Sumit, we are not just a lender but a true
partner in his success.

He is so impressed with us that he envisions being a part

of this journey forever, eager to continue working with us
and benefit from our exceptional support as his business
continues to thrive.

16 Annual Report 2023-24

 Corporate Overview

Enabling Ruby’s Stitching Dreams to Succeed

Ruby, a talented seamstress from Gomti Nagar, struggled
with limited resources despite her skill in crafting admired
bedsheets. Her dreams of expanding her business were
hindered by financial constraints and a refusal from traditional
banks, which deemed her enterprise too small for a loan.

Hope arrived when Ruby accessed our Shakti Loan, designed to

support small-scale women entrepreneurs. The loan enabled her
to purchase additional raw materials and a new sewing machine.
Her mother joined her, enhancing their production capacity and
boosting the family’s income.

With the expanded setup, Ruby successfully met growing

demand and began supplying local vendors. Her story
exemplifies empowerment and resilience, inspiring others to
pursue their dreams and overcome barriers.

Facilitating Muhammad Salman’s Journey of Growth

and Success
Muhammad Salman, a skilled woodworker with a passion for
his craft, sought to expand his business and took a decisive
step two years ago by securing a ₹ 1 lakh business loan from
us. This loan became a pivotal moment for him, allowing
him to invest in his woodworking venture and significantly
boosting his income.

The process was seamless and we made sure, he received

the fund without any hurdles, reaffirming his belief in our
support. Grateful for the positive impact on his business,
Muhammad looks forward to continuing his partnership with
us, hopeful that we will be there to support him in the future
as he grows his business further.

Aye Finance Private Limited 17

Management Discussion & Analysis
MANAGEMENT DISCUSSION
AND ANALYSIS
Industry Structure and Developments
Indian Financial Services Sector Review These joint efforts by both the government and the
private sector have propelled India into one of the most
India’s financial sector is witnessing rapid expansion, dynamic capital markets globally. A major driver of
marked by significant growth at established firms and the growth in this sector is the increased focus on financial
entry of numerous new players. This dynamic landscape inclusion, aimed at expanding access to finance for
includes a broad array of institutions, such as insurance marginalised and underserved segments of society.
companies, commercial banks, cooperatives, non-banking
financial companies (NBFCs), mutual funds, pension This emphasis has led to the rise of digital banking,
funds, and various smaller entities. Banking remains the microfinance initiatives, and partnerships with fintech
dominant force, representing 70% of the total assets within companies, which are transforming traditional banking
the financial system, however NBFCs lending is growing models.
faster than lending by Banks, specifically for the previously
Indian MSME Sector Review
underserved communities.
The MSME sector comprises of 633.9 lakh businesses in
India’s financial services sector is currently undergoing
India accounting for 33% of GDP and provides over 90%
a profound transformation, driven by the widespread
of non-agriculture employment in the country. Over 99%
adoption of digital technologies, changing consumer
of total MSMEs (approx. 630.5 lakh enterprises) qualify
preferences, and intensified competition. This evolving
as micro-enterprises. As India steadily approaches the
environment is reshaping the sector’s growth trajectory.
threshold of becoming a $5 Tn economy by 2026-27,
The rapid integration of technology has revolutionised
the MSME sector is projected to grow to $1 Tn by 2028.
how Indians access and pay for services, with even
Unquestionably, the development of this segment will
micro enterprises now accepting QR code payments.
help drive economic transformation and in meeting the
It is projected that this dramatic surge in India’s digital
national imperatives of financial inclusion.
payments market will triple from USD 3 trillion to USD 10
trillion by 2026 Yet, this has remained an area of commerce that
has been excluded by Banks and organized Finance
Banks, despite having specialized branches that cater
Companies. This is no random aberration. The obstacles
to the MSMEs, have not been able to fill the INR 5 trillion
are significant and overcoming these needs not just
credit deficit facing the sector. Their traditional products,
talent, but a steely will and the silver bullet of exceptional
processes and guidelines have been inadequate in
hard work.
addressing the vagaries in the life-cycles facing the
micro and small enterprises. A large number of NBFCs 1. Non-availability of Credit data: Banks have always
have stepped up to the challenge of filling this credit followed the discipline of seeking documentary
demand and supply gap and redefined the MSME Lending support and verifiable repayment histories of
ecosystem making them the ideal lender for the sector. borrowers. MSMEs often have no prior repayment
They fulfil the larger objective of financial inclusion while history (no Credit Bureau record) and rarely have
bridging the credit gap between traditional banks and formally maintained book of accounts. Their
underserved segments by offering tailored financial business revenues are seldom routed through their
products and services. By addressing the unique needs bank accounts.
of small or micro-enterprises, NBFCs enable them to
overcome financial barriers expand business operations 2. Small Ticket Size of the Loan: The MSMEs often
and contribute significantly to economic development. need loans between ` 1 and ` 5 lakhs and this is
The Government of India has also acknowledged the small for Banks and most financial institutions to
contribution of micro and small enterprises and introduced service as they need to keep all their salary costs,
several steps to ease access to finances to these under- administrative costs, credit and other losses lower
served segments of our nation. than this sum.

18 Annual Report 2023-24

 Corporate Overview

Government Initiatives Kirana Sector: In recent years, consumer shopping

patterns have shifted significantly, with more people
The Indian government has introduced several initiatives purchasing online, and opting for supermarkets or larger
to bolster the MSME sector, including the Productivity modern stores. Consequently, Kirana stores are losing
Linked Incentive (PLI) scheme, which provides substantial their customer base, with their share of the retail market
funding to boost manufacturing across various industries. expected to decline to 75% by 2021, down from the
Various other initiatives such as Udyam Registration current 88%. Aye is supporting the grocery store owners
Portal, PM Vishwakarma scheme and Prime Minister’s by providing them the much needed capital to scale
Employment Generation Programme are expected to up and adopt modern retailing techniques to expand
enhance competitiveness and drive growth within the customer base and increase profits.
sector. These initiatives span a range of strategies,
including tax exemptions, enhanced access to funding, Shoe Manufacturing Cluster: The shoe cluster in
and the expansion of financing, marketing, and technology India has achieved remarkable growth, contributing
support. Key policies driving this agenda include the significantly to the country’s standing in the global
Pradhan Mantri MUDRA Yojana (PMMY), the Special Credit leather industry. India is now the second-largest
Linked Capital Subsidy Scheme (SCLCSS), SAMBHAV, and exporter of leather garments, which is expected to
the National MSME Policy. drive the growth of our shoe cluster. In the past five
years, approximately 0.5 million unemployed individuals
Sector-Specific Growth have found employment in the shoe cluster, thanks
to targeted training programmes under various
Aye Finance empowers this underserved segment of
Government schemes. This growth reflects the sector’s
microenterprises by providing essential financial support,
robust expansion and its pivotal role in providing job
bridging the gap of the segment’s INR5 trillion unmet credit
opportunities and boosting India’s export capabilities
need. Aye has effectively addressed roadblocks within
which has made this sector critical for Aye as well.
traditional financial systems that impede microenterprises’
access to business loans by leveraging an innovative Sports Manufacturing Cluster: The Indian sports goods
underwriting system, cutting-edge technologies, and data market is projected to grow from US$ 3.9 billion in 2020-
science. 21 to US$ 6.6 billion by 2027, with key manufacturing
clusters playing a vital role in achieving these growth
Understanding Business Clusters: Aye uses a proprietary
targets. India is home to seven major sports goods
analytics powered “Cluster Based Credit Assessment”
manufacturing cities, with Jalandhar and Meerut
methodology to offer economical and adequate
standing out as the leading clusters, accounting for
line of credit to micro enterprises. This innovative
approximately 82% of the total production. These cities
methodology draws insights from the cluster data
boast over 3,000 manufacturing units and 130 exporters,
points and corroborates it with risk scorecards. This
leveraging their deep expertise in the sector. Currently,
data is corroborated with a deep repository of financial,
the majority of sports and fitness goods are produced
demographic, supply chain data of industry clusters. This
by small and medium enterprises (SMEs), underscoring
assessment methodology is continuously honed using
their significant contribution to the industry’s expansion.
analytics on data gathered by servicing loans across 180
plus industry clusters.

Keeping unit costs in check: Aye Finance has addressed

the small ticket size requirements of this sector having
innovated on developing a highly efficient method of
serving them. We have developed a hybrid approach to
achieve economies of scale by leveraging technology while
delivering and servicing the loan as per the comfort of the
grassroots businesses that have not yet fully embraced
the internet for accessing credit. Our use of Data Science
as a high-impact strategic tool has been instrumental in
bringing down our per unit cost. It has also been a critical
factor in driving nonlinear growth, enhanced efficiency and
profitability by digitalization and embedding state-of-the-
art data-driven decision-intelligence

Aye Finance is servicing over 180 clusters in India

supporting micro enterprises through its economical and
customised credit products.

Aye Finance Private Limited 19

Our Product Offering
Aye Finance products are customised to the needs of the micro scale businesses covering secured as well as unsecured
loans that help address the needs of a larger market.

Secured Business Loans

Secured loan book comprises 3 products, secured under property -ML & QML and secured under hypothecated goods.
Details of these products are:

a) Mortgage Loan (ML): To meet the higher loan amount/tenure needs for the long-term business requirements, secured
with the mortgage of immovable property.
b) Quasi-Mortgage Loan (QML): To meet short-term/long-term business needs, secured with the mortgage of the property
(where the title of the property is not clear).
c) Secured Hypothecation Loan: To meet short-term business needs, where the derived valuation of hypothecated goods
(such as stocks, machinery, working assets and book debts) is higher than the loan sanctioned.

The secured loan book grew by 131% from ` 1070.24 crores in FY22 to ` 2474.32 crores in FY24. In FY24, the secured
loan book formed 60% of the overall portfolio where 11% is secured by property under Quasi- Mortgage loan (QML) and
Mortgage Loan (ML) amounting to ` 453.75 crores. The remaining 49% is the secured hypothecation loan book, where the
derived valuation of hypothecated goods (such as stocks, machinery, working assets and book debts) adequately covers
the loan sanctioned.

Unsecured Business Loan

Unsecured loans meet short-term business needs without adequate security of the hypothecated goods. We also have a
women-focused loan product (Shakti loan) with enhanced credit underwriting and improved access to capital for women
entrepreneurs tailored to their financial needs. Aye Finance also offers a supply chain financing solution aimed at micro and
small enterprises by providing unsecured non collateralised credit lines to shop owners.

In FY24, the unsecured loan book forms 40% of the overall portfolio. The company witnessed significant growth in the
unsecured loan book as well which grew from INR 672.05 crores in FY22 to INR 1659.19 crores in FY24.

Outlook
Aye Finance’s innovative approach to lending has had a profound
impact on India’s MSME sector. We have provided over 8.5
lakh loans in the last 10 years making us the largest lender to
this segment. We are poised to capture a larger share of this
underserved market. The continued investment in digital platforms
and geographic expansion into semi-urban areas will enhance
customer acquisition and market penetration, contributing to a
growing loan portfolio and stronger market position. The company
remains committed to support micro-enterprises by providing
access to capital to grow, creating employment opportunities, and
contributing to the country’s economic development.

20 Annual Report 2023-24

 Corporate Overview

Aye Finance Private Limited 21

Risk Management
IDENTIFYING CHALLENGES.
MITIGATING RISKS.
A comprehensive risk management framework empowers us to
proactively anticipate challenges within the micro-enterprise sector
and respond with agility, thereby safeguarding our reputation and
financial stability. As the landscape of micro-enterprise financing
continues to evolve, it is imperative to engage in continuous
monitoring and adaptation to maintain resilience and promote
financial inclusion. By systemically identifying, assessing, and
mitigating potential risks, we not only fortify our portfolio and
ensure compliance with regulatory standards but also enhance the
robustness of our strategic decision-making processes.
Our robust risk management framework is anchored by our ICAAP policy, third-party risk monitoring, and quarterly reviews of
Key Risk Indicators. These mechanisms empower us to continuously identify, assess, and address key risks, ensuring that we
take timely actions to keep risks within acceptable limits while making informed decisions aligned with our strategic goals.

Enterprise Risk Management

Board of Directors

Asset & Liability Committee InfoSec Committee

IT Strategy Committee Risk Management
Committees of the Board
CSR Committee Committee
Audit Committee
External Audit

Nomination & Remuneration Committee

Regulator

First Line of Defence Second Line of Defence Third Line of Defence

Operational Compliance Risk Internal Audit
Functions Management Management (Head of Audit &
(Functional Heads) (Chief Compliance Officer) (Chief Risk Officer) Vigilance)

Managing risks Ensuring strict Anticipating potential risks Providing objective

associated with day- observance to all & making strategic choices oversight by
to-day operational statutory and regulatory to optimally manage the testing controls
and processes
Key metrics

activities requirements risk outcomes

Control effectiveness, Compliance risk Key risk indicators, Coverage,

incident frequency, assessment, risk mitigation Quality &
compliance rate incident frequency action plans timeliness

22
 Corporate Overview

Risk Management Matrix

Type of Risk Risk Description Mitigation Strategy

Credit Risk Possibility of losses associated Industry cluster-based underwriting

with attenuation in the credit
Pre-disbursal checks and post-disbursal monitoring
quality of borrowers
Data science and artificial intelligence applications

Portfolio Risk associated with significant Diversified exposure in advances across various
Concentration Risk credit exposure to a specific geographies, industries, and tenures
business segment, industry,
Periodic review of geographic and industry thresholds
geography, location etc.

Market & Strategic Risk to earnings and Structured strategic planning process
Risk capital arising from lack of
Competitive benchmarking
responsiveness to changes in
the business environment and/or Periodic review of strategic priorities with participation
adverse business decisions from key middle- and senior-level personnel from all
functions

Money Laundering Possibility that a financial Risk based approach

Risk institution, business, or individual
Continuous transaction monitoring
will be used to help illegal
activities like drug trafficking, Customer due diligence
terrorism financing, and other
criminal activities

Operational Risk Risks inherent to business Fraud prevention & management

operations arising from
Insurance
inadequate or failed internal
processes, people, systems, or Standard operating procedures
external events

IT & Cyber Risk Risk of failure, disruption, Cyber security tracking

unauthorised access, disclosure,
Crisis management
modification or destruction
of systems, infrastructure, or Regular risk assessments audits
processes
Business Continuity and Disaster Recovery plan
Access controls

Compliance Risk Non-compliance with various Continuous monitoring of compliance and regulatory
statutes and regulations resulting updates
in stringent actions and penalties
Internal control in financial reporting
from regulators or statutory
authorities, along with a risk to External expertise in specific areas.
Company’s reputation

Aye Finance Private Limited 23

Our People Management Competence
EMPOWERING OUR PEOPLE.
BUILDING FUTURE.
At Aye Finance, our employees drive our competitive success.
We invest in talent through recruitment, training, orientation, and
empowerment to deepen our competitive edge. Our commitment
to creating a robust talent pool involves upskilling employees,
providing career advancement opportunities, succession planning,
and effective talent management. This comprehensive approach
ensures we build and sustain an empowered team ready to meet the
challenges of tomorrow.

24 Annual Report 2023-24

 Corporate Overview

Strengthening Diversity and Women’s Empowerment

Implementing Zero-
tolerance POSH
policy covering all
Dedicating three genders
women Providing
entrepreneurs women’s safety
through ‘Shakti training
Loan’ initiative
1
10 2
Pioneering At Aye, we foster an Organising
safe travel environment of equality vibrant diversity
arrangements celebrations
9 where diversity is not just 3
embraced but celebrated.
Our commitment to creating
an inclusive workplace
is evident through a
Supporting
8 wide range of initiatives, 4 Undertaking
women in
inclusive hiring
reskilling particularly those dedicated
practices
endeavours to empowering women.

7 5

Women’s active
6
Offering special
participation in programmes to help
leadership roles women thrive
Granting family
care leaves and
flexible work
options

Aye Finance Private Limited 25

Key Inclusive Initiatives

Returning Improving Targetting Hiring Female-Only

Mothers’ Gender Women in Persons with Recruitment
Programme Diversity AVP+ Roles Disabilities Drives

Reward and Recognition Programmes Goa trip’, and many more with prizes ranging from
iPhone 15s to international trips to two-wheelers
Every employee is impressed upon the value of customer
Thank You letters from MD to employee’s families
commitment starting from the induction training and
continually boosted with training and reward programs. At Aye, we believe in working like a big family and
Various awards that celebrate and recognise Service that involves staying in touch with all our employee’s
Champions reiterate this value. In 2023, we gave 4,623 families. We have instituted a culture of writing
‘Cha Gaye’, 2,438 Aye ka Tara and 857 Service Excellence personalised letters to our employee’s families
awards. Our MD Club award is an honour employees whenever an employee achieves an exceptional award
aspire for. Our Blue Star Award – The silver star is given thanking them for their support and assistance.
to employees who win Aye Ka Tara or Service Excellence Families are also invited during the Annual awards and
during three consecutive times in a row. 359 Silver Star company outings
Champions were awarded during the year.
Employee Connect and Feedback
Aye Ke Vishesh
Branch Connects with HRBPs and Leadership Team
This award is given to recognize innovation driven
HR Business Partners at Aye with leadership team make
problem solving and foster collaborative approach to
branch visits with the objective to resolve employee
our business
queries, communicate the new process and policies,
Being Better Than What We Were Yesterday undertake training for new joiners and ensure smooth
We run multiple competitions for various departments functioning of all branches.
with varying lucrative rewards, over and above the
Monthly Townhalls
employee’s incentive. Some notable examples of these
include ‘Monsoon Magic’, ‘Diwali Dhamaka’, ‘BM/ CH/ This provides a platform to the employees interact directly
SH Foreign trip’, ‘Credit/Ops Foreign Trip’, ‘Supervisor with the MD on our internal learning platform, ILM. This

26 Annual Report 2023-24

 Corporate Overview

platform is used to discusses business performance,

targets and goals, employee concerns, company-
related issues, and any upcoming events.

Strategy Meets
Annual strategy meets are organised for the
leadership team to discuss the Company’s vision,
mission, goals and strategies for the year. These
meets are strategically designed for the management
to define the strategy for the organization. It is
a collaboration exercise and at the end of the
meet all departments actions are aligned with the
organization’s objectives & goals for the year.

Social Media Connect

Aye publishes all the important events and
information on all its social media handles. Our
employees, who are also our brand ambassadors,
regularly receive these updates through posts on our
official Facebook, Twitter, Instagram and LinkedIn
accounts.

Aye Fun Committee

We believe that fun does not just happen on its own,
it is cultivated. We have created a Fun Committee
which has representation from all departments and
is responsible for planning various engagement
activities to align with the Company’s value system.

Superwoman group
Superwoman group at Aye is a closed group of all
the female employees along with representations
from HR where they can share any problems and
issues they are facing. The idea behind this group
is to support women so that they can feel safe and
empowered at the workplace.

Aye Finance Private Limited 27

Our Technology Competence
INTEGRATING DIGITAL TECHNOLOGIES.
REVOLUTIONISING EXPERTISE.
At Aye, we harness the power of technology to streamline interactions
with stakeholders and expand our Company’s reach. By investing in
cutting-edge technologies such as data science and analytics, we aim
to predict customer behaviour and proactively adjust our strategies.

Embracing Technology to Drive Financial Aggregator solutions and integrated Bank APIs to
Inclusion streamline disbursements via IMPS and NEFT. We
also automated new income assessment methods,
Technology is the backbone of our mission to empower enhancing our efficiency and accuracy in evaluating
micro enterprises across India. By 2016, we had already financial profiles. Additionally, we introduced a
digitised the entire customer acquisition journey, from decentralised workflow for our mortgage loan
the first interaction to disbursement. Our processes product, ensuring smoother processing and better
became fully paperless, with sourcing and underwriting service delivery.
entirely managed on mobile devices. This has
significantly reduced turnaround times for decisions Enhanced Accessibility and Customer
and helped us keep costs down as we scaled up. Experience
We have built a robust and seamlessly integrated All our solutions and systems are centrally deployed
IT infrastructure that supports every aspect of our on a cloud-based infrastructure, allowing us to provide
operations. Partnering with industry leaders like Google, seamless access from anywhere while maintaining
Microsoft, Alteryx, and Tableau, we have implemented better control and optimised use of our technology
a Lead Management System, Loan Origination System, resources. By employing zero-trust solutions, we
Loan Management System, Collection Management ensure that only authorised users can access
System, ERP System, and various Collaboration and our systems, no matter where they are, without
Productivity tools. This integration has been pivotal in compromising security.
our ability to maintain efficiency and agility as we grow.
Given the size of our field force, we utilise GPS
Given that our customer base often has a limited data and related capabilities to map our customers
footprint in the formal financial system, we have effectively. This ensures that our teams can easily
leaned heavily on Machine Learning, Analytics, and locate and reach customers without wasting time,
Artificial Intelligence in our credit processes and upsell enhancing both efficiency and service delivery.
strategies. We segment our borrowers based on factors
To further improve our customer experience, we offer
such as demographics, historical loan information, telco
multiple channels for our customers to reach us.
data, and social media behaviour. Our ability to correlate
They can visit the nearest branch, call our dedicated
these behavioural insights with on-the-ground feedback
helplines equipped with automated IVR and call-
from our vast field presence allows us to create deep
back facilities, or use our mobile application to raise
business insights.
queries, provide feedback, check the status of their
Achievements in 2023-24 loans, and more. These options ensure that our
customers can connect with us in the way that’s
During 2023-24, we made significant strides in our most convenient for them, enhancing their overall
automation journey, focussing on verifications and experience with our services.
validations. We implemented integration with Account

28 Annual Report 2023-24

 Corporate Overview

Ensuring Robust Cybersecurity include implementing an Access Control Matrix,

utilising authentication and approval-based access
Information and cybersecurity are major focus areas for to systems, and encrypting data both at rest and in
our Company. To protect our technology assets and data, transit to ensure it remains secure.
we employ a comprehensive approach that combines
control processes, specialised services, and advanced To further strengthen our infrastructure, we leverage
solutions. Infrastructure as a Service (IaaS) from industry
leaders like AWS and Azure, ensuring our systems
Additionally, we regularly engage certified third-party are consistently updated and protected by top-tier
auditors to assess our IT infrastructure and systems. security solutions. Additionally, we conduct third-
These audits help us identify vulnerabilities, process party Information Systems Audits to identify and
gaps, and regulatory compliance issues, ensuring that we address any potential gaps in our processes and to
maintain the highest standards of security and integrity. ensure compliance with regulatory requirements.

Safeguarding Customer Privacy

Our customer data is our most valuable asset, and we
protect it through several rigorous measures. These

Aye Finance Private Limited 29

Corporate Social Responsibility
EMPOWERING CHANGE.
MAKING SOCIAL IMPACT.
In India, over 60 million unorganised businesses face significant
challenges in raising capital, improving product quality, establishing
market linkages, and enhancing operational efficiencies. Thriving
micro businesses create more job opportunities, particularly for
women, young people, and vulnerable groups, thus contributing to
sustainable development.

Aye has been invested in the

development of micro enterprise Our Focus Areas
sector since its inception and
through its Section 8 arm, Creating & Building
the Company has bridged the enhancing livelihood capabilities
gap between the aspiration opportunities of micro-
and opportunities available for vulnerable enterprises
to them through non-financial communities through skilling
interventions.

Supporting these micro

businesses advances our
progress towards multiple Community Promotion of gender
United Nations Sustainable wellbeing equality and women’s
Development Goals (SDGs), empowerment
including no poverty, zero hunger,
gender equality and reduced
inequalities.

30 Annual Report 2023-24

 Corporate Overview

About FAME
At FAME, our mission is to unlock the potential of the officers, especially women, have become inspirational
unorganised micro-enterprise sector, which includes 60 figures and role models in their communities. This
Million grassroots businesses. Our implementation team approach has allowed FAME to develop a solid grassroots
is recruited from within the communities we serve, builds presence and achieve meaningful outcomes for our
trust and familiarity with our target beneficiaries. This beneficiaries. Through our customised interventions, we
method has successfully addressed social issues and are narrowing the gap between the aspirations of this
strengthened community ties. In many projects, our field sector and the opportunities available to them.

Outcomes
Our Interventions Our Outcomes
Skilling
Product
Improvement
Increased Income
Improved
Employability
1,18,000
Lives Touched
Creating Livelihood Active Women
Opportunities Participation

22,000
Access to Better Community
Market Wellbeing

Women Entrepreneurs Trained

Footprint

5 4 3,00,000
Clusters States Hours of Training

12 200+ 98,000
Districts Villages Livestock Treated

Aye Finance Private Limited 31

Our Programmes
Dairy Development Programme
FAME’s Dairy Development Programme aims to increase
the income of rural households from dairy farming while
also providing preventive healthcare services for cattle and
livestock. Since its launch in 2019, the programme has been
supporting dairy farmers in overcoming obstacles to their
growth. It has positively impacted the lives of over 90,000
dairy farmers across 12 districts in Uttar Pradesh, Rajasthan,
Punjab, and Haryana. The following four interventions are
undertaken under the dairy development programme:
Healthcare Services
Doorstep Veterinary Servicesa
Milk Collection Centre
FAME Service Centre

Key Initiatives

Reducing Farm Healthcare Costs Augmenting the Income of Dairy Farmers

FAME’s healthcare services have delivered free, door-to- FAME Milk Collection Centres ensure that dairy
door treatment to over 100,000 livestock farmer members receive a fair price for their milk
based on its quality, effectively eliminating their
Cutting Expenses on Cattle Feed reliance on middlemen
FAME’s Service Centres (FSCs) provide the advantages In collaboration with AMUL (Banas Dairy), FAME’s
of collective purchasing to their members, significantly milk collection centres sold 6.36 Million litres of milk,
reducing expenses on dairy inputs providing farmers with over a 20% improvement in
Through its 33 FSCs, FAME sold 3,68,000 kg of dairy milk prices compared to middlemen
inputs and generated savings of ₹ 2,050,000 for its dairy
farmer beneficiaries

Shoe Artisans Programme

Despite making a significant contribution to the economy, the
Agra footwear industry faces myriad of challenges that hinder
the growth of the artisans. The objective of FAME’s Shoe
Artisans Programme is to support the women shoe artisans
of Agra in improving their skills, creating quality products and
enhancing their livelihood opportunities. FAME’s Shoe Artisans
Programme provides comprehensive support, empowering
women to build careers in the shoe manufacturing industry.
The following four interventions are undertaken under the shoe
artisans programme:
In-House Training
Industrial Exposure
Marketing Support (Online & Offline)
Income Generation Programme

Key Initiatives

Skilling Women Ensuring Regular Sources of Income

Trained 268 women in the comprehensive shoe Generated ₹ 18 lacs in income for the 100 trained
manufacturing process women, with each woman earning at least ₹ 3,000
per month
Creating Livelihood Opportunities
Empowered women with decision-making authority
Created regular job opportunities for 100 trained women within their families and communities

32 Annual Report 2023-24

 Corporate Overview

Sports Cluster Development Programme

Despite its substantial contribution to sports goods
production, the Meerut sports industry faces numerous
challenges, particularly the lack of recognition and
underpayment of women manufacturers. FAME’s Sports
Cluster Development Programme aims to upskill women in
the sports manufacturing sector, recognising their crucial
role in the development of this cluster and seeking to rectify
their often-overlooked contributions. The initiative helped
empower women with decision-making authority within their
families and communities. The following four interventions are
undertaken under the sports cluster development programme:
Capacity Building Trainings
Improving Product Quality
Enhancing Marketing Capabilities
Income Generation Programme

Key Initiatives

Skilling Women Ensuring Regular Sources of Income

Trained 144 women in the production of high-quality Generated an income of ₹ 8,70,000 by creating
sports goods, enabling them to secure various job livelihood opportunities for 144 women
opportunities

Development Initiative for Women

Association
DIWA, FAME’s Entrepreneurship Development Project,
focusses on empowering women from marginalised
communities in urban and semi-urban areas to establish
their own savory businesses. Under this project, FAME
provides hands-on training to women on all aspects of
running a successful enterprise, along with infrastructure
and machinery support. Launched in August 2023, DIWA
began with a single savory training centre in Modinagar
and a group of 10 women with no prior experience in savory
production. The following four interventions are undertaken
under the development initiative for women association
programme:
Skilling
Infrastructure Branding & Machinery Setup
Branding & Marketing
Developing a Distribution Network

Outcomes of the Programme

Within just six months of training, these women mastered the art of making savory snacks, selling over 800 kg of namkeen
and earning an income of ₹ 95,000. Encouraged by the results of this pilot project, FAME plans to strengthen this interven-
tion and launch multiple centres to create livelihood opportunities for a larger number of marginalised women.

Aye Finance Private Limited 33

Awards and Accolades
HONOURING ACHIEVEMENTS.
CELEBRATING RECOGNITIONS.

Frost & Sullivan Award

Frost & Sullivan recognised Aye Finance as the
‘Technology Innovation Leader in the Indian
Inclusive Fintech Solution Industry for 2024,’ noting Innovation in Financial Technology
our comprehensive digital lending process for
Aye Finance was honoured with the Governance Now
microenterprises.
6th BFSI Award in the category ‘Innovation in Financial
Technology.’

Access Development – Inclusive

Finance India Award Quantic India Award
Aye Finance won the Inclusive Finance India Award in Aye Finance received the Quantic India Award for Best
the category ‘Best Small & Micro Enterprise Lending Use of Data & Analytics Project at The 4th Annual BFSI
by Non-Banking Finance Company,’ providing Excellence Awards 2023, hosted by Quantic India.
unsecured small-ticket loans to address the funding
challenges of credit-starved MSMEs.

Corporate Vision Awards

Aye Finance was honoured with the esteemed ‘Most
Best MSME Financing Institution Supportive Financial Working Environment 2024 –
India’ award by Corporate Vision.
Aye Finance was honoured with the prestigious ‘Best
MSME Financing Institution’ Award at the 5th edition
of the Emerging Businesses Awards hosted by BW
Businessworld.

Best Use of Data and Analytics

Best For-Profit Project for Underserved
Aye Finance received the award for Best Use of
Communities
Data and Analytics at the 4th Annual BFSI Excellence
Aye Finance was awarded the Best For-Profit Awards, organised by Quantic. This prestigious
Project for Underserved Communities by The Money awards programme is dedicated to technological
Awareness and Inclusion Award. projects and innovations in the BFSI sector.

34 Annual Report 2023-24

 Corporate Overview

Recognised as a Great Place to Work

We are proud to be certified for

the fifth consecutive time among
the Best Companies to Work for
in India by Great Place to Work®,
ranking 6th.

Aye Finance was featured among

India’s Best Workplaces™ for
Millennials 2023 by Great Place to
Work®, ranked among the top 10.

For the third consecutive year, Aye

Finance has been recognised among
the Best Companies to Work for in
Asia by Great Place to Work®.

Featured among India’s Best

Workplaces in BFSI 2023 : Top
25 by GPTW

Featured among India’s

Best Workplaces in NBFC
2023 by GPTW

Aye Finance Private Limited 35

BOARD OF
DIRECTORS
G. R Chintala
Chairman & Independent Director
Mr. Chintala is a financial services veteran with over 35 years of experience. He was the Chairman
of National Bank for Agriculture and Rural Development (NABARD) from 2020 to 2022 and prior
to that held leadership positions at NABFINS, NABVENTURE & NAB FOUNDATION. He has been
the Director of Bankers Institute of Rural Development (BIRD) and also served on the Boards of
Institute for Rural Management (IRMA), DICGC and on the Advisory Board of IIM-Ahmedabad.

Kanika T. Bhal
Independent Director
Prof. Bhal is a Ph D from IIT Kanpur and is the Modi Chair Professor at the Department of
Management Studies at IIT Delhi and is a visiting fellow at Sloan School of Management, MIT. She
has authored books on leadership, culture and ethics. Prof. Bhal has done sponsored research
for several nationally and internationally funded (with Fordham University and Wharton Business
School) projects and has been a consultant to various government organizations. She has been
conferred with several awards and is given the honor of Professor Honorable by Tshwane Institute
of Technology, South Africa.

Sanjaya Gupta
Independent Director
Mr. Gupta is a banking professional with over 35 years of extensive experience in leading high
performing professional teams. He served as the MD & CEO of PNB Housing Finance Limited from
2010 to 2020. Prior to that was the Co-founder and non-executive chairman of India Shelters. As
MD designate of a four-way joint venture between AIG Inc. National Housing Bank (regulator),
International Finance Corporation (IFC) and Asian Development Bank (ADB) he conceptualized the
first mortgage guarantee product in India. He was awarded the “Economic Times Most Promising
Business Leader Asia 2018-19”

Vinay Baijal
Independent Director
Mr. Baijal is a distinguished industry professional who has served as a Chief General Manager
at RBI. As CGM, Foreign Exchange Department, he played a crucial role in policy framing and
implementation of exchange control in India. He has also contributed to drafting Rules and
Regulations under FEMA. He set up the Banking Codes and Standards Board of India (BCSBI) and
served as its first CEO. He has served as a member of the World Bank Task Force on International
Standards on Credit Data Reporting as well of the National Core Committee to deal with FATF
Assessment of India in 2009.

Sanjay Sharma
Managing Director
Mr. Sanjay Sharma heads the organization and directly oversees its business strategy. As a
Founder, he has led the company from a tech driven start up aspiring to deliver social impact,
into an award-winning financial services firm that is delivering social impact at scale along with
robust financial returns. He is an accomplished leader in Consumer Banking with over 34 years
of experience in BFSI segment handling leadership roles in HSBC, HDFC Bank, ICICI and Max Life
Insurance. Set up Tamweel PJSC and grew it into the largest housing finance company in UAE with
over USD 3bn in assets. He is an alumnus of IIT-Bombay and IIM-Bangalore.

36 Annual Report 2023-24

 Corporate Overview

Gaurav Malhotra
Director, British International Investment Representative
Mr. Gaurav Malhotra is Director and Head for Financial Services Equity at British International
Investment (BII). BII is the UK’s development finance institution and impact investor with a mission
to help solve the biggest global development challenges by investing patient, flexible capital to
support private sector growth and innovation. He holds a PGDM from the IIM-Banglore and B.
Engineering from Delhi College of Engineering.

Kartik Srivatsa
Director, Lightrock India Representative
Mr. Kartik Srivatsa is the Managing Partner India and Chief Strategy Officer of Lightrock. He is
the founding partner of Lightrock India, formerly Aspada. He also acts as the fund advisor for the
SONG Fund through Aspada Capital Advisors. Formerly he was with Lightspeed Venture Partners,
a global venture capital firm with over US$ 2 billion under management. He is a graduate of the
Indian Institute of Technology (IIT), Madras.

Kaushik Anand
Director, A91 Partners Representative
He is a Partner at A91 Partners, a venture capital focused on growth stage companies. Previously,
he was Head of India Investments at CapitalG (formerly Google Capital) where he focused on
technology and financial services businesses. At CapitalG, he led investments in Aye Finance,
Cardekho, Freshworks and Cuemath. He is an alumnus of Harvard Business School and IIT Madras.

Navroz Darius Udwadia

Director, Alpha Wave Representative
Mr. Navroz D. Udwadia is the Chief Executive Officer, Co-Founder and Partner at Alpha Wave
(erstwhile Falcon Edge Capital, LP). Prior to this he worked with Eton Park specializing in emerging
markets. He is a graduate from Columbia University (BA, English), has a law degree (MA, Law) at
Oxford University and is an MBA from Harvard Business School.

Vivek Mathur
Director, Elevation Capital Representative
Mr. Vivek Mathur is an Operating Partner and joined Elevation Capital (erstwhile SAIF) in 2011. He
assists portfolio companies scale by working with them on matters such as finance, operations,
compliance, and structuring. He has 20 years of deep operational experience in finance, banking &
strategy. Vivek has a B.E from BITS Pilani and an MBA from University of IOWA.

Aye Finance Private Limited 37

DIRECTORS’ REPORT

To the Members of Aye Finance Private Limited Regulations”), the Company is categorised as High Value
Debt Listed entity (“HVD”).
The Directors have immense pleasure in presenting their
31st Annual Report together with the audited financial The Company has also received Certificate of Registration
statements of the Company for the financial year ended under the Registration of Corporate Agents - Regulations,
March 31, 2024. 2015 from the Insurance Regulatory and Development
Authority of India (“IRDAI”) to act as Corporate Agent
COMPANY OVERVIEW effective from June 27, 2024.

Aye Finance Private Limited (“Company”) is a Non-Deposit As on March 31, 2024, the Company have 478 branches
Accepting Non-Banking Finance Company holding a spread across 21 states in India. We have lent to over ~2.7
Certificate of Registration from the Reserve Bank of India Lakh customers during the course of the year. As on March
(“RBI”) since 2014 engaged in the business to provide term 31, 2024, the Company has 7,001 employees helping these
loan or working capital finance to micro, small and medium customers pursue their dreams.
scale enterprises, proprietorship or partnership firms. We are elated to announce our prestigious ranking as the
6th Great Place to Work. This marks the 5th consecutive time
In terms of RBI Master Direction – Scale Based Regulation,
we have been ranked amongst the top 10 best places to
the Company has been classified as Middle Layer NBFC.
work in India. This accolade underscores our unwavering
The Non-Convertible Debentures issued by the Company dedication to cultivating an inspiring and supportive
on private placement basis are listed on Wholesale workplace culture. Heartfelt gratitude to our extraordinary
Debt Market segment of BSE. In terms of Securities team for making this distinguished achievement a reality.
and Exchange Board of India (Listing Obligations and We, as a team, have achieved success, stayed positive,
Disclosure Requirements) Regulations, 2015 (“SEBI Listing and found new ways to support each other in previously
unimaginable ways.

FINANCIAL SUMMARY/HIGHLIGHTS, STATE OF AFFAIRS

The Company’s financial performance for the year ended March 31, 2024 is summarised below:

(` crore)
Particulars March 31, 2024 March 31, 2023
Revenue from operations 1,040.22 623.43
Other income 31.53 19.91
Total revenue 1,071.75 643.34
Expenses
Employee benefit expenses 275.21 212.20
Finance costs 326.53 197.96
Impairment on Financial Assets 131.40 73.35
Depreciation and amortisation expenses 14.54 11.45
Net Loss on fair value changes 6.18 6.57
Other expenses 90.03 70.41
Total expenses 843.89 571.94
Profit before tax 227.86 71.40
Tax Expenses 66.73 17.61
Profit after tax 161.13 53.79
Other Comprehensive Income (0.41) 2.99
Profit after tax (after OCI) 160.72 56.78
Earnings per share (equity share, par value of ` 10 each)
Basic (`) 49.84 17.34
Diluted (`) 49.29 17.13

38 Annual Report 2023-24

 Statutory Reports

DIRECTORS’ REPORT (CONTD.)

OPERATIONS, FUND RAISE, PROSPECTS AND FUTURE COMPANY'S PROSPECTS, FUTURE PLANS AND
PLANS BUSINESS OVERVIEW

Operational Highlights Business Overview:

• 
The Net loan portfolio of the Company stood at Founded in 2014, Aye Finance has carved a niche by
` 4,003.12 crore as on March 31, 2024. focusing on serving the MSMEs, which struggle to secure
loans from traditional banks due to a lack of credit history
• Loan amount of ` 3,930 crore was disbursed in FY 2023-
and collateral. The Company offers Hypothecation Loans
24 representing an increase of ~67% as compared to
(“HL”) and Mortgage loans for working capital requirements
FY 2022-23.
to include such businesses under the formal financial
During the period under review, the Company witnesses system. Our business model revolves around innovative
increase in net profit after tax of ` 161.13 crore as compared credit assessment, personalized lending and technology
to ` 53.79 crore for the year ended March 31, 2023. Total integration to bridge this financial gap and empower
income has increased from ` 643.34 crore for the year MSMEs.
ended March 31, 2023 to ` 1,071.75 crore for the year ended
The loan portfolio grew approximately 64% driven by an
March 31, 2024.
increase in active borrowers and geographic expansion
The Company has Long term Credit Rating maintained at maintaining stable net profit margins. Investments in
India Ratings IND A-/Positive, further on July 19, 2024 rating technology and better credit assessments have enhanced
was upgraded to IND A/Stable. operational efficiency and customer experience.

Fund raised during 2023-24:- HL provided by the Company to the business borrowers
• Resource mobilisation - are in the nature of a collateralized loan. These Loans
collaterals are in the nature of inventory, receivables,
During the year under review, the Company has
livestock and machine tools etc. and are properly backed
continued to diversify the sources of funds and
up by the HL agreement signed with the borrowers. Based
raised a sum of ` 4,093.42 crore by way of Equity,
on the considerate assessment and expert opinion on the
Compulsory Convertible Preference Shares (“CCPS”),
Classification of the HL Product, Company has classified
Warrants, Short & Long term loans, Non-Convertible
HL portfolio as Secured, wherever the value of Security is
Debentures, External Commercial Borrowings (“ECB”)
higher than the loan amount at the time of disbursement
and DA/Securitisation which has helped the Company
of the loan.
to achieve its' business target for FY 2023-24. Out of
overall fund raised, ` 310 crore were raised through Future Outlook:
Equity, CCPS & Warrants issuances and ` 3,783.41 Aye Finance’s innovative approach to lending has had a
crore raised through borrowings, which includes profound impact on India’s MSME sector. The Company
` 678.70 crore by issuance of non-convertible remains committed to support small businesses by
debentures and ` 1,411.50 crore by way of term providing access to capital to grow, creating employment
loan/WCDL. The Company also raised funds through opportunities and contributing to the country’s economic
ECB route of ` 230.46 crore while ` 1,426.75 crore development. As the company continues to expand and
was raised through Direct Assignments/PTCs. The refine its business model, it stands as a shining example to
aggregate debt outstanding as on March 31, 2024 was drive financial inclusion and empower small entrepreneurs
` 3,498.99 crore. The Company has been regular in in emerging economies.
servicing all its debt obligations.

• Bank Finance - RESERVE

Bank Finance remains an important source of funding An amount of ` 32.23 crore, being 20% of the profit after tax
for the Company. Banks continued their support to (PAT) was transferred to statutory reserve of the Company
the Company. As of March 31, 2024, Borrowings pursuant to Section 45IC of the Reserve Bank of India Act,
from Banks were ₹ 685.33 crore (30.92%) as against 1934. Further, an additional amount of ` 4.70 crore has been
₹ 133.88 crore (18.57%) in the previous financial year. transferred to Share option outstanding account during the
year under review.

Aye Finance Private Limited 39

DIRECTORS’ REPORT (CONTD.)

DIVIDEND CHANGE IN THE NATURE OF BUSINESS

To grow the business line of the Company, the Directors There was no change in the nature of the business of the
have not recommended any dividend on equity shares for Company during the financial year ended March 31, 2024.
the year ended March 31, 2024.
RISK MANAGEMENT
CAPITAL STRUCTURE
Risk Management is an integral part of the Company’s
Authorised Share Capital business strategy. The risk management process is
governed by the enterprise-wide risk management
During the year under review, Authorised Share Capital of
framework which is overseen by the senior management.
the Company is increased from ` 34.60 crores consisting
They review compliance with risk policies, monitor risk
of 55,00,000 Equity Shares having face value of ` 10 each
tolerance limits, review and analyse risk exposure related
& 2,91,00,000 Preference Shares having face value of ` 10
to specific issues and provides oversight of risk across the
each to ` 45.31 crores consisting of 67,30,000 Equity Shares
organisation.
having face value of ` 10 each, 2,91,00,000 Preference
Shares having face value of ` 10 each and 47,40,000 The Board of Directors have adopted a Risk Management
Preference Shares having face value of ` 20 each, vide Policy for the Company which provides for identification
Shareholders approval in Extra-Ordinary General Meeting of key events/risks impacting the business objectives
held on November 17, 2023. of the Company and attempts to develop risk policies
and strategies to ensure timely evaluation, reporting and
Further, after March 31, 2024 the Authorised Capital of
monitoring of key business risks.
the Company was also increased from ` 45.31 crores
consisting of 67,30,000 Equity Shares having face value of The risk management framework covers integrated risk
` 10 each, 2,91,00,000 Preference Shares having face value management mainly comprising Credit Risk, Market
of ` 10 each and 47,40,000 Preference Shares having face Risk, Operational Risk, Regulatory Risk and Information
value of ` 20 each to ` 82 crores consisting of 4,34,20,000 Technology Risk. The Credit Risk management structure
Equity Shares having face value of ` 10 each, 2,91,00,000 includes documented credit policies and procedures for
Preference Shares having face value of ` 10 each and each financial product. The risk policies define prudential
47,40,000 Preference Shares having face value of ` 20 limits, portfolio criteria, exceptional approval metrics, etc.
each, vide Shareholders approval in Extra-Ordinary General and cover risk assessment for new product offerings.
Meeting held on August 16, 2024. Concentration Risk is managed by diversifying into different
geographies and sectors.
Paid-up Capital
Risks associated with frauds are mitigated through fraud
As on March 31, 2024, Paid-up capital of the Company stood
risk monitoring procedures. The Company has a strong
at ` 40,49,14,560 consisting of 48,30,520 Equity Shares
field vigilance function that ensures checks and balances
having face value of ` 10 each, 2,61,82,448 Preference
at the field level with respect to end use of loans, adherence
Shares having face value of ` 10 each and 47,39,244
to policies and sourcing practices. Fraud risk is monitored
Preference Shares having face value of ` 20 each.
through oversight by senior management, who review
During the year under review, the Company had raised an matters relating to fraud risk, including corrective and
amount of ` 310 crore by way of issuance of 20 Equity remedial actions as regards people and processes.
Shares having face value of ` 10 each at a premium of
Pursuant to Regulation 21 of SEBI Listing Regulations,
` 644.11 and 47,39,244 Series F Compulsory Convertible
the Company has a Risk Management Committee which
Preference Shares having face value of ` 20 each at a
is responsible for monitoring and reviewing the risk
premium of ` 634.11 to the existing and new shareholders
management plan & ensuring its effectiveness. Risk
in accordance with Amended and Restated Shareholders’
Committee meets at least once in every quarter to assess
Agreement dated December 06, 2023.
and review the risk profile of the organisation to ensure that
DEPOSITS risk is not higher than the risk appetite determined by the
Board.
The Company has not accepted/received any deposit during
the year under review falling within the ambit of Chapter V of INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
the Companies Act, 2013 and the Companies (Acceptance
The Company’s internal control system is designed to
of Deposits) Rules, 2014, as amended from time to time.
ensure operational efficiency, protection and conservation

40 Annual Report 2023-24

 Statutory Reports

DIRECTORS’ REPORT (CONTD.)

of assets, accuracy in financial reporting and an overall Further, a statement containing salient features of the
compliance with laws and regulations. The internal control financial statements of the Subsidiary Company in Form
system is supported by an internal audit process for AOC-1, which form part of this Report as Annexure-A
reviewing the adequacy and efficacy of the Company’s pursuant to Rule 8(1) of the Companies (Accounts) Rules,
internal controls, including its systems and processes 2014, as amended.
and compliance with regulations and procedures. The
Company’s internal control system is commensurate with CORPORATE SOCIAL RESPONSIBILITY
the size, nature and operations of the Company. In compliance with Section 135 of the Companies
The Company has in place strong internal audit processes Act, 2013 read with the Companies (Corporate Social
and systems which design an audit plan to ensure optimum Responsibility Policy) Rules 2014, as amended from time
portfolio quality and keep risks at bay. Internal Audit to time, the Company has established the Corporate Social
department takes care of internal control processes. There Responsibility Committee and the composition, function
is a risk based audit methodology covering all key functions and details of meetings attended by the Committee
of the Company, planned based on various risk based Members are provided in the Corporate Governance Report
parameters. The Audit Committee of the Board of Directors, which forms part of the Annual Report. The Board adopted
comprising of Independent Directors, periodically reviews the CSR Policy, formulated and recommended by the CSR
the internal audit reports, covering findings, adequacy Committee, and the same is available at https://www.
of internal controls, and ensure compliances. The Audit ayefin.com/policies/.
Committee also meets the Company’s Statutory Auditors to During the period under review, the Company has
ascertain their views on the financial statements, including contributed ` 1 crore to Foundation for Micro Enterprises
the financial reporting system, compliance to accounting (FAME), wholly owned subsidiary of the Company, which
policies and procedures, adequacy and effectiveness of the is a not-for-profit company, within the meaning of Section
internal controls and systems followed by the Company. 8 of the Companies Act, 2013 (erstwhile Section 25 of
Information System Security Controls enable the Company the Companies Act, 1956), was incorporated in India on
to keep a check on technology-related risks and also April 04, 2019. FAME carries out CSR activities under the
improve business efficiency and distribution capabilities. direction and CSR Policy adopted by the Company in line
the Company is committed to invest in IT systems, including with the Schedule VII of the Companies Act, 2013. The
back-up systems, to improve the operational efficiency, Company primarily focuses on projects or programs that
customer service and decision-making process. include promoting and development of (a) livelihoods; (b)
rural development; (c) skill development; & (d) and benefit
MATERIAL EVENTS SUBSEQUENT TO THE DATE OF of the socially weaker section.
FINANCIAL STATEMENTS
FAME is dedicated to building the capabilities of micro-
There are no material changes and commitments affecting entrepreneurs promoting sustainable economic growth.
adversely the financial position of the Company, which FAME recognizes that micro-entrepreneurs are the
have occurred between the end of the financial year of the backbone of the economy and by empowering them, it
Company i.e. March 31, 2024 and the date of this report strives to create a positive impact on society. Through skill
except mentioned under respective headings. development, training on manufacturing quality products,
adoption of effective marketing techniques and a focus
SUBSIDIARY, ASSOCIATE AND JOINT VENTURE on women empowerment, FAME is creating a sustainable
COMPANIES inclusive ecosystem that eliminates poverty and fosters
economic growth at the grassroots level.
As on March 31, 2024, the Company had only 1 (one)
Wholly Owned Subsidiary i.e. Foundation for Advancement As per amended CSR Rules and CSR Policy of the Company,
of Micro Enterprises (“FAME”), incorporated under the funds required to be disbursed have been utilised for
Companies Act, 2013 as Section 8 Company. Further, there the purposes and in the manner as approved by the Board
are no associate or Joint Venture Companies within the of Directors of the Company and confirmation to this effect
meaning of Section 2(6) of the Companies Act, 2013 as on have been received from Mr. Krishan Gopal, Chief Financial
March 31, 2024. Officer and Ms. Sheena Sakhuja, Officer in-charge for CSR in
the Company and such confirmations have been duly noted
There has been no material change in the nature of the
by the Board in its meeting held on May 24, 2024.
business of the subsidiary.

Aye Finance Private Limited 41

DIRECTORS’ REPORT (CONTD.)

Key initiatives under each thematic area and the Annual iv) they have prepared the annual accounts for financial
Report on CSR under Section 135 of the Companies year ended March 31, 2024 on a going concern basis;
Act, 2013 read with Rule 8 of the Companies (Corporate
v) 
they have devised proper systems to ensure
Social Responsibilities Policy) Rules, 2014, is annexed as
compliance with the provisions of all applicable laws
Annexure-B to this Report and the same is available on the
and that such systems were adequate and operating
website of the Company i.e. www.ayefin.com.
effectively during the financial year ended March 31,
AUDIT COMMITTEE 2024.

The Company has an Audit Committee duly constituted AUDITORS & AUDITORS’ REPORT
in accordance with the provisions of Section 177 of
the Companies Act, 2013, Master Direction – Reserve Statutory Auditors & their reports
Bank of India (Non-Banking Financial Company – Scale Pursuant to the guidelines issued by RBI on April 27, 2021 for
Based Regulation) Directions, 2023 and Regulation 18 of appointment of Statutory Central Auditors (SCAs)/ Statutory
SEBI (Listing Obligations and Disclosure Requirements) Auditor (SAs) of Commercial Banks (excluding RRBs), UCBs
Regulations, 2015, as amended (“SEBI Listing and NBFCs (including HFCs) vide its circular No. RBI/2021-
Regulations”). All the members of the Committee have 22/25 Ref. No DoS.CO.ARG/SEC.01/08.91.001/2021-22
expertise in finance and have knowledge of accounting (“RBI Circular”), the Company is required to appoint the
and financial management. The scope of the activities of Statutory Auditors for a continuous period of 3 (three)
the Audit Committee, as set out in Regulation 18 of SEBI years subject to the firm satisfying the eligibility norms. As
Listing Regulations and Section 177 of the Companies Act, our existing Auditors M/s. S. R. Batliboi & Associates LLP,
2013 and other applicable laws, are approved by Board of Chartered Accountants (Firm Registration No. 101049W/
Directors of the Company. The composition of the Audit E300004) had completed their term of 3 (three) years as
Committee & its terms of reference and the details of
a Statutory Auditors of the Company, therefore in terms of
meetings attended by the Audit Committee members are
the aforesaid RBI Circular, they were not eligible to continue
provided in Corporate Governance Report which forms part
as Statutory Auditor from the conclusion of 30th Annual
of the Annual Report.
General Meeting of the Company.
During the year under review, all the recommendations
Further, the Board of Directors of the Company had
of the Audit Committee were accepted by the Board of
recommended the appointment of M/s S S Kothari Mehta
Directors of the Company.
& Co. LLP (formerly known as S S Kothari Mehta & Co.),
Chartered Accountants, New Delhi, (Firm Registration
DIRECTORS RESPONSIBILITY STATEMENT
No. 000756N/N500441) issued by Institute of Chartered
Pursuant to Section 134(5) of the Companies Act, 2013, the Accountants of India, having a valid Peer Review Certificate
Board of Directors, to the best of their knowledge and ability, issued by the Peer Review Board of ICAI, as the Statutory
confirm that: Auditors of the Company on the recommendation of the
i) 
in the preparation of the annual accounts for the Audit Committee, for a term of three (3) years.
financial year ended March 31, 2024, the applicable Accordingly, M/s S S Kothari Mehta & Co. LLP (formerly
accounting standards had been followed along with
known as S S Kothari Mehta & Co.), Chartered Accountants,
proper explanation relating to material departures (if
New Delhi, (Firm Registration No. 000756N/N500441), have
any);
been appointed as the Statutory Auditors of the Company
ii) 
they have selected such accounting policies and at the 30th Annual General Meeting (“AGM”) of the Company
applied them consistently and made judgments and held on September 29, 2023, on the recommendation of
estimates that are reasonable and prudent so as to Audit Committee and Board of Director’s in conformity with
give a true and fair view of the state of affairs of the the provisions of Sections 139 and 141 of the Companies
Company as on March 31, 2024 and of the profit/loss Act, 2013 read with the Companies (Audit and Auditors)
of the Company for the year ended March 31, 2024; Rules, 2014 (includes amendments thereto) and in
iii) they have taken proper and sufficient care for the accordance with the aforesaid RBI Circular read with the
maintenance of adequate accounting records Company’s policy on Appointment of Statutory Auditors for
in accordance with the provisions of this Act for a period of 3 (three) years from the conclusion of the AGM
safeguarding the assets of the Company and for (for F.Y. 2022-23) till the conclusion of the 33rd AGM (for F.Y.
preventing and detecting fraud and other irregularities; 2024-25) subject to the applicable provisions from time to
time.

42 Annual Report 2023-24

 Statutory Reports

DIRECTORS’ REPORT (CONTD.)

The Statutory Auditors have confirmed that they are not Secretarial Audit Report does not contain any qualification,
disqualified from continuing as the Statutory Auditors of reservation, adverse remarks, or disclaimer.
the Company.
The Board has placed on record its sincere appreciation for
The Auditors’ Report for the financial year 2023-24 does the services rendered by M/s. Brajesh Kumar & Associates,
not contain any qualification, reservation, adverse remark Company Secretaries as Secretarial Auditors of the
or disclaimer. Further, there were no instances of any fraud Company for the Financial Year 2023-24.
reported by the Statutory Auditor to the Board pursuant to
Section 143 (12) of the Companies Act, 2013. FRAUDS REPORTED BY AUDITORS

The Board has placed on record its sincere appreciation During the period under review, neither the Statutory Auditors
for the services rendered by M/s S S Kothari Mehta & Co. nor the Secretarial Auditors have reported to the Audit
LLP, Chartered Accountants, as Statutory Auditors of the Committee/ Board or Central Government any instances
Company. of fraud in the Company by its officers or employees under
Section 143(12) of the Companies Act, 2013.
Secretarial Auditors & their Report:
However, there have been few instances of embezzlement
In terms of Section 204 of the Companies Act, 2013 read
of cash by staff, involving amount to aggregating to ` 0.42
with Rules framed thereunder, the Company is required to
crore. In such cases, employees were terminated from their
appoint Secretarial Auditors to carry out the secretarial
services and legal action has also initiated against such
audit of the Company.
employees.
M/s Brajesh Kumar & Associates, Company Secretaries has
been with the Company from past many years. However, for NUMBER OF MEETINGS OF THE BOARD
good corporate governance and to align with Company’s The Board of Directors met 11 (eleven) times during the year
future plans, it was decided to rotate the existing Secretarial under review. The details of the same have been included in
Auditors and after careful evaluation with experience in the Corporate Governance Report, which forms part of the
auditing listed companies and NBFCs and based on the Annual Report.
recommendation of the Audit Committee, the Company
had appointed M/s Sanjay Grover & Associates, Company BOARD OF DIRECTORS AND KEY MANAGERIAL
Secretaries as Secretarial Auditors of the Company for the PERSONNEL
financial year 2024-25 in its meeting held on May 24, 2024.
A. Board of Directors
The Company has provided all the assistance and the
The Board of Directors, along with the Committees of
facilities to the Secretarial Auditors for conducting the
the Board, provides leadership and guidance to the
Secretarial Audit. Secretarial Audit Report as provided by
Company’s Management and directs, supervises and
M/s Brajesh Kumar & Associate is also annexed to this
controls the activities of the Company.
Report, in the prescribed Form No. MR-3, as Annexure-C. The

As on March 31, 2024, the Board of Directors of the Company consists of 8 (eight) Directors. The details are as follows:

S. Name of Directors Category

No.
1. Dr. Govinda Rajulu Chintala* Chairperson, Non-Executive & Independent Director
2. Mr. Sanjaya Gupta Non-Executive & Independent Director
3. Ms. Kanika Tandon Bhal Non-Executive & Independent Director
4. Mr. Sanjay Sharma Managing Director
5. Mr. Kartik Srivatsa Non-Executive & Non-Independent Director
6. Mr. Kaushik Anand Kalyana Krishnan Non-Executive & Non-Independent Director
7. Mr. Vivek Kumar Mathur Non-Executive & Non-Independent Director
8. Mr. Navroz Darius Udwadia Non-Executive & Non-Independent Director
*Designated as Chairperson of the Board effective from January 05, 2024.

Aye Finance Private Limited 43

DIRECTORS’ REPORT (CONTD.)

During the year under review, Non-Executive Directors 

Appointment of Non-Executive & Non-
of the Company had no pecuniary relationship or Independent Director
transactions with the Company. The Independent Pursuant to Amended and Restated Shareholders
Directors were paid sitting fees for attending each Agreement dated December 06, 2023, Investors
meeting of the Board of Directors or any Committee have a right to nominate and maintain 1 (one)
thereof in accordance with the limit as approved by Nominee Director on the Board of the Company.
Board and Nomination & Remuneration Committee of
the Company. In view of the above, British International
Investment plc (“BII”) had recommended
The Composition of the Board is in accordance Mr. Gaurav Malhotra (DIN: 07640504) as its
with Section 149 of the Companies Act, 2103 and Director (representative of BII), to be appointed in
Regulation 17 of SEBI Listing Regulations with an the Board of the Company. Basis that Nomination
optimum combination of Executive & Non-Executive and Remuneration Committee & Board after
Directors. The change in the Board of Directors during considering the fit & proper criteria recommended
the financial year upto the date of this report are as the appointment of Mr. Gaurav to the Members
follows: of the Company. The members in its Extra-
Ordinary General Meeting held on June 26, 2024
Appointment/Re-appointment:
had approved the appointment of Mr. Gaurav
Appointment of Independent Directors Malhotra (DIN: 07640504) as Non-Executive &
Based on the recommendation of Nomination and Non-Independent Director of the Company, not
Remuneration Committee & Board of Directors, liable to retire by rotation, for a term of 5 (five)
Members of the Company at their Extra-Ordinary consecutive years effective from June 26, 2024.
General Meeting held on September 01, 2023 had
approved the appointment of following directors Resignation/Cessation:
as Non-Executive & Independent Director of the During the year under review, the following
Company for a term of 5 (five) consecutive years Non-Executive & Independent Directors of the
effective from September 01, 2023: Company were resigned from the Company
effective from September 02, 2023:
Dr. Govinda Rajulu Chintala (DIN: 03622371)
Ms. Arpita Pal Agrawal (DIN: 08588528)
Mr. Sanjaya Gupta (DIN: 02939128)
Mr. Navin Kumar Maini (DIN: 00419921)
Ms. Kanika Tandon Bhal (DIN: 06944916)
Mr. Vinay Baijal (DIN: 07516339)

Further, Based on the recommendation of
Nomination and Remuneration Committee & Board The Board place on its record its appreciation for
of Directors, Members of the Company at their the valuable contribution of above Directors in
Extra-Ordinary General Meeting held on August the sustained growth of the Company during their
16, 2024 had approved the appointment of Mr. tenures.
Vinay Baijal (DIN: 07516339) as an Independent
Director for a term of 5 (five) consecutive Continuation of Non-Retiring Director
years, not liable to retire by rotation, effective In compliance with sub-regulation 17(1D) of
from August 16, 2024 and in accordance with the SEBI (Listing Obligations and Disclosure
Regulation 17(1A) of SEBI Listing Regulations, to Requirements) (Second Amendment)
continue as an Independent Director beyond June Regulations, 2023, effective from April 01, 2024,
15, 2026, on account of his attaining the age of 75 the continuation of a director on the Board of a
years on the said date. listed entity requires shareholder approval in a
general meeting at least once every five years
The Board is of the opinion that above directors
from their appointment or reappointment date.
are the person of integrity, expertise, and possess
competent experience and proficiency to serve Additionally, any director serving on the Board
the Company as an Independent Directors that as of March 31, 2024, who has not received
can strengthen the overall composition of the shareholder approval within the last five years
Board. or more, must obtain such approval at the first
general meeting held after March 31, 2024.

44 Annual Report 2023-24

 Statutory Reports

DIRECTORS’ REPORT (CONTD.)

In view of the above requirement, on the Further, Mr. Krishan Gopal was appointed as Chief
recommendation of Nomination and Financial Officer and Key Managerial Personnel of
Remuneration Committee & Board of Directors, the Company effective July 07, 2023, succeeding
the Members of the Company at their Extra- Mr. Mayank Shyam Thatte, who resigned effective May
Ordinary General Meeting held on June 26, 2024 24, 2023 (close of business hours) due to personal
had approved the continuity of Directorship of reasons.
following directors on the Board, for a period of 5
Furthermore, Mr. Vipul Sharma was appointed as
(five) years and not liable to retire by rotation:
Company Secretary, Compliance Officer, and CCO
(i) Mr. Navroz Darius Udwadia (DIN: 08355220) (Key Managerial Personnel) effective May 25, 2024,
as Non-Executive & Non-Independent succeeding Ms. Tripti Pandey and she continues to
Director of the Company representing Alpha serve as Deputy Company Secretary of the Company.
Wave India I LP. The Board place on its record its appreciation for the
valuable contribution of Ms. Tripti in the sustained
(ii) Mr. Vivek Kumar Mathur (DIN: 03581311) as
growth of the Company during her tenure.
Non-Executive & Non-Independent Director
of the Company representing Elevation
DECLARATION BY INDEPENDENT DIRECTORS
Capital V Limited.
All the Independent Directors and there is an appropriate
(iii) Mr. Kartik Srivatsa (DIN: 03559152) as Non-
balance of skills, experience and knowledge in the Board
Executive & Non-Independent Director of the
to enable the Board to discharge its functions and duties
Company representing LGT Capital Invest
effectively. The Independent Directors have submitted
Mauritius PCC with Cell E/VP.
disclosure that they continue to meet the criteria of
(iv) 
Mr. Kaushik Anand Kalyana Krishnan independence as provided under Section 149(6) of
(DIN: 07719742) as Non-Executive & Non- the Companies Act, 2013 and Regulation 16(1)(b) of
Independent Director of the Company SEBI Listing Regulations and they are not aware of
representing A91 Emerging Fund I LLP. any circumstance or situation, which exists or may be
reasonably anticipated, that could impair or impact
B. Key Managerial Personnel their ability to discharge their duties with an objective
As on March 31, 2024, Mr. Sanjay Sharma, Managing independent judgement and without any external influence.
Director, Mr. Krishan Gopal, Chief Financial Officer and
In the opinion of the Board of Directors, the Independent
Ms. Tripti Pandey, Company Secretary, Compliance
Directors fulfil the conditions specified in the Companies
Officer & CCO are the Key Managerial Personnel of
Act, 2013 and rules made thereunder for appointment as
the Company in accordance with the provisions of
Independent Directors including the integrity, expertise
Sections 2(51) and 203 of the Companies Act, 2013
and experience & confirm that they are independent of the
read with Companies (Appointment and Remuneration
management.
of Managerial Personnel) Rules, 2014.
In terms of Section 150 of the Act read with Rule 6(1) and
During the year under review, Mr. Sanjay Sharma’s
6(2) of the Companies (Appointment and Qualification of
current term as Managing Director of the Company
Directors) Rules, 2014, the Independent Directors of the
was going to expire on July 4, 2024. Under his
Company have also confirmed that they have registered
commendable leadership, the Company has seen
themselves with the databank maintained by the Indian
significant growth and achieved impressive results,
Institute of Corporate Affairs.
even with the challenges brought on by the nearly
two-year Covid pandemic. Recognizing the need for
COMPLIANCE WITH RBI GUIDELINES
ongoing progress and aligning with future plans, the
members on the recommendation of Nomination and The Company has complied and continues to comply with
Remuneration Committee and the Board of Directors Master Direction – Reserve Bank of India (Non-Banking
approved the reappointment of Mr. Sanjay Sharma at Financial Company – Scale Based Regulation) Directions,
the Extra-Ordinary General Meeting held on June 26, 2023 (“RBI Scale Based Regulation”), as amended from
2024, for another consecutive term of 5 (five) years, time to time [earlier Non-Banking Financial Company–
effective from July 5, 2024 to July 4, 2029 (both days Non-Systemically Important Non-Deposit taking (Reserve
inclusive). Bank) Directions, 2016] and all the applicable regulations

Aye Finance Private Limited 45

DIRECTORS’ REPORT (CONTD.)

and guidelines issued by RBI such as Capital Adequacy, Net NOMINATION AND REMUNERATION POLICY
Owned Funds, provisioning for Non-Performing Assets and In order to set our principals, parameters and governance
for Standard Assets, Concentration of Credit and Investment framework of the remuneration for Directors, Manging
and filings, etc. Director, Key Managerial Personnels and employee
The Company continues to fulfil all the norms and standards of the Company and in terms of Section 178 of the
laid down by the RBI pertaining to capital adequacy, Companies Act, 2013, Regulation 19 of SEBI Listing
statutory liquidity assets etc. The Capital Adequacy Ratio Regulations and RBI Master Direction - Scale Based
(“CAR”) of the Company was 32.79% as on March 31, 2024 Regulations dated October 19, 2023, as amended from
which is well above the RBI mandated norm. time to time, the Company has in place Nomination
and Remuneration Policy which contains appointment,
In accordance with the above RBI Scale Based Regulation, reappointment, removal and remuneration including
the Company is classified under the Middle Layer NBFC criteria for determining qualifications, positive
category. attributes of Director & Key Managerial Personnels.

COMPLIANCE WITH SECRETARIAL STANDARDS The Nomination and Remuneration Policy is also
available at https://www.ayefin.com/policies/
All applicable mandatory Secretarial Standards i.e. SS – 1,
SS – 2 relating to ‘Meetings of the Board of Directors’, and The composition of the Nomination and Remuneration
‘General Meetings’ (as amended from time to time) issued Committee & its terms of reference and the details
by the Institute of Company Secretaries of India have been of meetings attended by the Nomination and
duly complied by the Company during the period under Remuneration Committee members are provided in
review. Corporate Governance Report which forms part of the
Annual Report.
POLICIES
DETAILS OF SIGNIFICANT OR MATERIAL ORDERS
VIGIL MECHANISM/WHISTLE BLOWER PASSED BY REGULATORS OR COURTS OR TRIBUNAL

The Company is committed to highest standards of During the period under review, there were no significant
ethical, moral and legal business conduct. Accordingly, or material orders passed by the regulators or courts
the Board of Directors has established a Vigil or tribunals impacting the going concern status of the
Mechanism through Whistle Blower Policy which is in Company and its operations in future.
compliance with the provisions of Sections 177(9) &
COST RECORDS AND COST AUDIT
(10) of the Companies Act, 2013 read with rule 7 of
Companies (Meetings of Board and its Powers) Rules, Maintenance of cost records and requirement of Cost
2014 and Regulation 22 of SEBI Listing Regulations. Audit as specified by the Central Government under sub-
The Policy provides adequate safeguard against section (1) of Section 148 of the Companies Act, 2013 is
victimisation to the Whistle Blower and enables them not applicable on the Company.
to raise concerns and also provides an option of direct HUMAN RESOURCES
access to the Chairman of Audit Committee. During
As on March 31, 2024, the Company had 7,001 permanent
the period under review, none of the personnel have
employees at its branches, regional office and Head office.
been denied access to the Chairman of the Audit
The Company recognises the importance of human value
Committee.
and ensures that proper encouragement both moral and
During the period under review, no complaints were financial is extended to employees to motivate them. The
received by the Company under the vigil mechanism. Company enjoyed excellent relationship with workers and
The Whistle Blower Policy is also available at https:// staff throughout the year.
www.ayefin.com/policies/

46 Annual Report 2023-24

 Statutory Reports

DIRECTORS’ REPORT (CONTD.)

ENERGY CONSERVATION & TECHNOLOGY ABSORPTION

(A) Conservation of Energy: The operations of the Company, being Financial Services related, require
(i)  the steps taken or impact on normal consumption of electricity. The Company is taking every necessary
conservation of energy: step to reduce the consumption of energy. In view of the nature of activities
carried on by the Company, there is no capital investment on energy
(ii) the steps taken by the Company for conservation equipment.
utilising alternate sources of energy:
The Company, being engaged in financing business within the Country,
(iii) 
the capital investment on energy does not have any activity relating to conservation of energy. The Directors,
conservation equipment’s: therefore, have nothing to report on investment in equipment for conservation
of energy.
(B) Technology Absorption: The Company has seen successful implemented Lead Management, Loan
(i) the efforts made towards technology Origination, Collection Management, Navision ERP and Data Warehouse
absorption: systems. The Company has also adopted the policies as per the RBI master
directions applicable on Systemically Important NBFCs. With new systems
(ii) the benefits derived like product in place, the Company has achieved seamless flow of data across various
improvement, cost reduction, product systems, making information flow faster, more robust and reliable. The
development or import substitution: Company has also set up the Data Science department.
(iii) 
in case of imported technology The initiatives by Data Science and Artificial Intelligence (DSAI) department
(imported during the last three yearsare focusing on use cases to help data-driven decision-making using data-
reckoned from the beginning of the insights, AI/ML models, and intelligent automation of processes. In addition
Financial Year): to a couple of initial projects including a machine learning model for
(iv) the expenditure incurred on Research behavioural scoring of customers. The Company has also initiated working
and Development: on streamlining and collating data from multiple systems and sources into a
coherent repository – a data lake which would be a key enabler infrastructure
for many of the future DSAI projects allowing seamless access to most of
the data generated across the organisation in a timely manner.
The Company, being engaged in financing business within the Country,
does not have any activity relating to technology absorption and export of
materials, goods or services. The Directors, therefore, have nothing to report
on Technology absorption.
(C) Foreign Exchange Earnings and Outgo The Foreign Exchange earnings and Foreign Exchange outgo during the year
under review are as below:

Particulars Amount Purpose

(` in crore)
Foreign Exchange Earnings 1.27 Grant received
Foreign Exchange Outgo 22.04 IT related expenses,
Subscription fee, Appraisal
fee, Depository charges & ECB
Interest payment
There was no unhedged foreign currency exposure in the Company as on
March 31, 2024.

EMPLOYEE STOCK OPTION PLAN

The Company has adopted the Aye Finance Employee Stock Option Plan, 2024 (ESOP 2024) which was approved by the Board
of Directors in their meeting held on June 25, 2024 and by the shareholders of the Company by way of special resolution in
their Extra-Ordinary General Meeting held on June 26, 2024.

Nomination and Remuneration Committee (NRC) is empowered to formulate the detailed terms and conditions of the ESOP
2024, administer and supervise the same. The eligible employees of the Company to whom the options are granted, and their
eligibility criteria is determined by the NRC.

Aye Finance Private Limited 47

DIRECTORS’ REPORT (CONTD.)

Details of ESOP disclosure pursuant to Rule 12 of Companies (Share Capital and Debentures) Rules, 2014 and the provisions
of Section 62 of the Companies Act, 2013 read with rules framed thereunder as on March 31, 2024 are appended below:

Sr. Particulars ESOP 2016 ESOP 2020

No.
1. Options granted 6,01,303 10,99,630
2. Options vested during the year 3,44,750 2,46,741
3. Options exercised - -
4. The total number of shares arising as a result of exercise of option NA NA
5. Options lapsed/Surrendered 3,01,164 1,19,836
6. The exercise price NA NA
7. Variation of terms of options NA NA
8. Money realised by exercise of options NA NA
9. Total number of options in force 3,00,139 9,79,794
10. Details of options granted to:
(i) Key Managerial Personnel
Options Granted: 5,055 69,604
Options Vested: 3,539 1,469
Options lapsed/Surrendered: 3,286 -
Total number of options in force: 1,769 69,604
(ii) any other employee who receives a grant of options in any one year
of option amounting to five percent or more of options granted during Nil Nil
that year
(iii) identified employees who were granted option, during any one year,
equal to or exceeding one percent of the issued capital (excluding
Nil Nil
outstanding warrants and conversions) of the Company at the time of
grant.

PERFORMANCE EVALUATION ii. reviewed the performance of the Chairperson of the

Company, taking into account the views of executive
Pursuant to the provisions of Section 178 of the Companies
and non-executive Directors; and
Act, 2013 read with rules made thereunder, Regulation 17(10)
read with Part D of Schedule II of SEBI Listing Regulations, iii. Assessed the quality, quantity and timelines of flow
the Nomination and Remuneration Committee and Board of of information between the Company management
Directors have specify the criteria or manner for effective and the Board that was necessary for the Board to
evaluation formulated a policy for performance evaluation effectively and reasonably perform their duties.
(same is covered under the Nomination and Remuneration
Further, in terms of the provisions of Section 178 of the
Policy of the Company) of its own performance, of various
Companies Act, 2013 read with rules made thereunder and
mandatory Committees of the Board and of the individual
Regulation 19(4) read with Part D of Schedule II of SEBI
Directors.
Listing Regulations, the performance evaluation process
Further, in terms of the provisions of Regulation 19(4) of all the Independent and Non-Independent Directors
read with Part D of SEBI Listing Regulations. In view of the of the Company were carried out by the Nomination and
Board approved Nomination and Remuneration Policy, the Remuneration Committee in its meeting held on March 20,
Independent Directors in their separate meeting held on 2024 and made recommendation to the Board.
March 27, 2024 under Schedule IV of the Companies Act,
Further, in terms of Regulation 17(10) of SEBI Listing
2013 had:
Regulations and Schedule IV of the Companies Act,
i. reviewed the performance of Non-Independent 2013, the Board of Directors took into consideration the
Directors and the Board as a whole; recommendation received from the Nomination and

48 Annual Report 2023-24

 Statutory Reports

DIRECTORS’ REPORT (CONTD.)

Remuneration Committee and completed the performance The details of the related party transactions as per Indian
evaluation process in their meeting held on March 27, 2024. Accounting Standards (IND AS) - 24 are set out in Notes to
the Financial Statements of the Company.
The entire performance evaluation process was completed
to the satisfaction of Board. The Company in terms of Regulation 23 of the SEBI Listing
Regulations regularly submits within the prescribed time
ANNUAL RETURN from the date of publication of its financial results for the
half year, disclosures of related party transactions in the
Pursuant to Section 92(3) read with Section 134(3)(a) of the
format specified, to the stock exchange(s).
Companies Act, 2013 read with Rule 12 of the Companies
(Management & Administration) Rules, 2014, copy of The disclosure of Related Party Transactions as required
Annual Return for the financial year ended March 31, 2024 under Section 134(3)(h) of the Act in form AOC-2 is not
is available on the website of the Company at https://www. applicable.
ayefin.com/wp-content/uploads/2024/09/Annual-Return_
DISCLOSURE AS PER THE SEXUAL HARASSMENT OF
MGT_7_2023-24.pdf.
WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
AND REDRESSAL) ACT, 2013
PARTICULARS OF LOANS,GUARANTEES OR INVESTMENTS
UNDER SECTION 186 OF THE COMPANIES ACT, 2013 The Company has always believed in providing a safe and
harassment-free workplace for every individual working on
Since, the Company is Non-Banking Financial Company,
the Company’s premises through various interventions and
the disclosures regarding particulars of the loans given,
practices. The Company always endeavours to create and
guarantees given and security provided is exempt under the
provide an environment that is free from discrimination and
provisions of Section 186(11) of the Companies Act, 2013
harassment including sexual harassment.
read with rules made thereunder, as amended. Further, the
details of investments made by the Company are given in The Company has in place a robust policy on the prevention
the Notes to the Financial Statements. of sexual harassment in the workplace. The policy aims at
the prevention of harassment of employees and lays down
PARTICULARS OF RELATED PARTY TRANSACTIONS the guidelines for identification, reporting, and prevention
of sexual harassment.
The Company has Board approved Related Party Transaction
Policy and Policy on Determining Materiality of Related There is an Internal Complaints Committee (ICC) which is
Party Transactions (RPT Policy). The Policy provides for responsible for redressal of complaints related to sexual
harassment and follows the guidelines provided in the
identification, necessary approvals by the Audit Committee/
policy. During the year ended March 31, 2024, there was no
Board, reporting and disclosure requirements in compliance
case reported to the committee.
with the requirements of the Companies Act, 2013 and
SEBI Listing Regulations. During the year under review, the
OTHER DISCLOSURES
Company has revised its RPT Policy, in accordance with
the amendments to applicable provisions of the Act/SEBI 
There are no details required to be reported with
Listing Regulations. regards to difference between amount of the valuation
done at the time of one-time settlement and the
All transactions entered by the Company during the financial valuation done while taking loan from the Banks or
year with related parties were on arms' length basis and in Financial Institutions as the Company has not done
the ordinary course of business as per the RPT Policy of any settlement with any Bank or Financial Institutions
the Company and in compliance with the provisions of the since its inception.
Companies Act, 2013 and SEBI Listing Regulations
The Company has neither filed any application nor
During the year under review, the Company has not entered any proceedings pending under the Insolvency and
into any contracts/arrangement/transaction with related Bankruptcy Code, 2016 during the reporting year,
parties which could be considered material in accordance hence no disclosure is required under this section.
with Regulation 23 of the SEBI Listing Regulations and
The Company has not issued any sweat equity shares
the RPT Policy of the Company. The RPT Policy may be
or equity shares with differential voting rights during
accessed on the website of the Company and the web-link the year.
of the same is https://www.ayefin.com/policies/

Aye Finance Private Limited 49

DIRECTORS’ REPORT (CONTD.)

ACKNOWLEDGEMENT various regulatory & government authorities and employees

of the Company. Your support as shareholders of the
The Board of Directors wish to place on record their sincere
Company is greatly valued by us. Board acknowledges your
appreciation for the continued support and cooperation
continued association and support in the growth of the
received from shareholders, bankers, other stakeholders,
organisation.

For and on behalf of the Board of Directors of

Aye Finance Private Limited

Sd/- Sd/-
Govinda Rajulu Chintala Sanjay Sharma
Chairperson & Independent Director Managing Director
DIN: 03622371 DIN: 03337545
Date: September 19, 2024 Place: Hyderabad Place: Gurugram

50 Annual Report 2023-24

 Statutory Reports

ANNEXURE-A

FORM AOC-1

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014)
Statement containing salient features of the financial statement of subsidiaries/associate companies/joint ventures

Part A: Subsidiaries
(` In lakh)
Sl. No. Particulars Details
1. Name of the subsidiary Foundation for Advancement of Micro Enterprises
(“FAME”), registered under Section 8 of the Companies
Act, 2013
2. The date since when subsidiary was acquired/incorporated 04-04-2019
3. Reporting period for the subsidiary concerned, if different N.A.
from the holding company’s reporting period
4. Reporting currency and Exchange rate as on March 31, N.A.
2024 in the case of foreign subsidiaries
5. Share capital - Authorised Share Capital- 100
6. Reserves & surplus 6.65
7. Total assets 36.65
8. Total Liabilities 36.65
9. Investments NA
10. Turnover NA
11. Surplus/(Deficit) before taxation 2.52
12. Provision for taxation NA
13. Surplus/(Deficit) after taxation 2.52
14. Proposed Dividend NA
15. Extent of shareholding (in %) 100%

Part B: Associates and Joint Ventures

Statement pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate Companies and Joint Ventures
Name of associates/Joint Ventures Not Applicable
1. Latest audited Balance Sheet Date
2. S hares of Associate/Joint Ventures held by the company on
the year end
No.
Amount of Investment in Associates/Joint Venture
Extend of Holding%
3. Description of how there is significant influence
4. Reason why the associate/joint venture is not consolidated
5. Net worth attributable to shareholding as per latest audited
Balance Sheet

6. Profit/Loss for the year

i. Considered in Consolidation
ii. Not Considered in Consolidation

For and on behalf of Board of Directors of

Aye Finance Private Limited

Sd/- Sd/-
Govinda Rajulu Chintala Sanjay Sharma
Chairperson & Independent Director Managing Director
DIN: 03622371 DIN: 03337545
Date: May 24, 2024 Place: Virginia, USA Place: Gurugram

Aye Finance Private Limited 51

ANNEXURE-B
ANNUAL REPORT ON CSR ACTIVITIES FOR FINANCIAL YEAR 2023-24

1. Brief outline on CSR Policy of the Company:

There are 60 Million un-organised businesses in India that make 70% of all businesses. Thriving micro-businesses means
more jobs for more people, especially women, young people and vulnerable groups. Supporting micro-businesses will
boost progress on more than half of United Nations SDGs. Aye has incorporated FAME (Foundation for Advancement
of Micro Enterprises) to harness the capabilities of the micro-enterprise sectors in India through beyond financing
support. FAME, a no profit organisation within the meaning of Section 8 of the Companies Act, 2013, was incorporated
in Haryana, India on April 04, 2019. The Foundation carries out CSR activities in the thematic areas of skilling, livelihood,
and promoting gender equality & empowering women which are in line with Schedule VII of the Companies Act, 2013.

FAME is dedicated to building the capabilities of micro-entrepreneurs promoting sustainable economic growth. FAME
recognises that microentrepreneurs are the backbone of the economy, and by empowering them, it strives to create a
positive impact on society. Through skill development, training on manufacturing quality products, adoption of effective
marketing techniques and a focus on women empowerment, FAME is creating a sustainable inclusive ecosystem that
eliminates poverty and fosters economic growth at the grassroots level.

2023-24 was FAMEs 5th year of operations and the impact the Foundation created and the partners that were onboarded
during the year made it a watershed year.

In addition to financial support committed by the Company, FAME received a three-year project and approval of ` 4.6
crore from Hindustan Unilever to expand the reach and impact of FAME’s Dairy Development Project. Charities Aid
Foundation Limited India collaborated with FAME and provided a grant of ` 12.16 lakh to build the Shoe Artisan Project.
FAME also signed an MOU with AMUL (Banas Kantha) to open milk collection centers for the Dairy Farmers in Mathura
and provide them with fair pricing and reduce their dependence on the middleman.

FAME since its inception has worked with over 1 lac beneficiaries in 4 States of UP, Rajasthan, Punjab and Haryana and
provided tangible outcomes in the form of livelihood opportunities, increased incomes, reduced expenses which has led
to an improved standard of living for their families and the community at large.

PROGRAMS UNDER IMPLEMENTATION

1. FAME’S DAIRY DEVELOPMENT PROGRAM

FAME instituted this Program in 2019 to address the challenges dairy farmers in rural and semi urban geographies
face which restrict their progress along with constricting the development of the entire sector. In India dairying is
an important secondary source of income for Millions of rural families and has assumed the most important role in
providing employment and income generating opportunities, particularly for marginal and women farmers. But the
Indian Dairy Farmer continues to struggle with various challenges – disease and feed management of their farm
and sub optimal profits due to sub optimal scale being the gravest of their concerns.

FAME in the last five years has addressed these challenges for over 90,000 Dairy Farmers in Mathura, Meerut,
Hapur, Modi Nagar, Sumerpur, Etah, Orai, Hissar, Alwar, Sikar, Bharatpur, Nabha and Rajpura through collaboration
with Amul to open fair price milk collection centers, opening of subsidised shops for dairy inputs and by providing
treatment and advisory through certified doctors.

During 2023-24 FAME delivered the following for the beneficiaries in the dairy sector

1. Conducted over 850 Awareness and Doorstep Veterinary camps

2. Free of cost treatment to 26,000 cattle

3. 34 FAME Service Centers are operational through which:

a) 3.68 lakh kg of dairy inputs of over ` 1.08 crore were sold

b) ` 20.50 lakh of savings generated for the beneficiaries

4. 17 Milk Collection Centers opened in collaboration with AMUL (Banas Kantha) through which:

a) Over 6.36 lakh liters of milk was sold

b) ` 3.20 crore of revenue generated for the beneficiaries.

52 Annual Report 2023-24

 Statutory Reports

ANNUAL REPORT ON CSR ACTIVITIES FOR FINANCIAL YEAR 2023-24 (CONTD.)

c) Total Benefit of ` 51.36 lakh generated for the beneficiaries.

d) An improvement of 20.18% over the middleman price

2. SHOE ARTISAN PROGRAM

Agra is India’s main footwear production center, contributing about 65% of total domestic demand and a whopping
28% share of India’s overall footwear export. Despite an opportunity this large, the women shoe artisan of the city is
not able to benefit as they lack the skills and the confidence to earn a livelihood and make a meaningful contribution
to the sector.

FAME launched its Shoes Artisan Program in 2022 to bring the women shoe artisan belonging to marginalised and
minority communities of Agra into the forefront of the Shoe Cluster by skilling them and providing them with an
opportunity to earn a living.

Over 260 women have been trained on the art of making a good quality shoe at our in-house training center and
have been collectively earned ` 20 lakh using the skills learnt at our center.

This program of FAME aligns with Sustainable Development Goals- SDG1 (No poverty), SDG 2 (Zero Hunger), SDG
5 (Gender Equality), SDG 8(Decent work and Economic growth), SDG 9 (Industry, Innovation and Infrastructure) and
SDG 10 (Reduce Inequalities). By supporting women in creating a source of income the Program has made them
financially independent, increased their confidence levels and also improved standard of living for their families.

3. DIWA (Development Initiative of Women Association) – Savories Cluster

FAME started a Social Enterprise DIWA (Development Initiative for Women Association) to support the women
belonging to marginalised communities to start their own savories manufacturing enterprise. In its first phase, 10
women from Nagla Patu village of Modi Nagar (a district in UP) are being supported to launch their own business
of savories. All these women are housewives and because of the social construct of the village, have never stepped
out of their homes to learn a skill or earn a living.

Despite the deep-seeded social inequalities stacked up against them, they have taken this leap of faith towards
financial independence and creating an identity for themselves.

Under this, FAME is providing the following support to the women.

• Skilling

• Infrastructure & Machinery Set up

• Establishing Distribution channels – Rural Semi Urban and Urban Markets

• Branding & Marketing

• Financial Management

This Program was launched in August 2023 and after the initial 3 months of training women started manufacturing
3 varieties of savories. From November 2023 - March 2024, women produced and sold 800kg of savories and
earned a revenue of ` 95,000.

The initial results of this project have been very encouraging and in the coming year FAME is aiming to expand its
reach and benefit a larger number of women and support their aspirations to become financially independent.

4. SPORTS CLUSTER DEVELOPMENT PROGRAM

FAME’s Sports Cluster Development Program has transformed the landscape of the sports manufacturing industry
in Meerut by making women manufacturers an active participant in this traditionally male dominated sector. FAME
Trainers provide training to hone the skills of women which has led to improved and sustainable livelihood for them.

During the year 124 women were trained on manufacturing good quality footballs and FAME linked these women
with manufacturers in the city to provide 67 women wage work at higher rates.

Aye Finance Private Limited 53

ANNUAL REPORT ON CSR ACTIVITIES FOR FINANCIAL YEAR 2023-24 (CONTD.)

Through skill enhancement and forward linkages with large manufacturing units, FAME has increased their income
by 40%. The trained women collectively earned approx ` 9 lakh and each women averaged ` 2,000 per month.

2. Composition of CSR Committee:

Sl. Name of Director Designation / Nature of Directorship Number of Number of meetings
No. meetings of CSR of CSR Committee
Committee held attended during the
during the year year
1. Ms. Arpita Pal Agrawal* Non-Executive Independent Director 2 1
(Chairperson)
2. Ms. Kanika Tandon Bhal# Non-Executive Independent Director 2 1
(Chairperson)
3. Mr. Sanjay Sharma Managing Director (Member) 2 2
4. Mr. Kartik Srivatsa Non-Executive Non-Independent 2 1
Director (Member)

* Ms. Arpita Pal Agrawal resigned from the position of Independent Director on September 02, 2023 and consequently
stepped down from the position of Chairperson of CSR Committee


#
Ms. Kanika Tandon Bhal was appointed as an Independent Director of the Company on September 01, 2023 and assumed
the role of Chairperson of the CSR Committee.

3. Provide the web-link where Composition of CSR committee, CSR Policy and CSR projects approved by the board are
disclosed on the website of the Company:
 omposition of CSR committee shared above and is available on the Company’s website at https://www.ayefin.com/
C
wp-content/uploads/2024/02/Committee-composition_revised_Feb-2024.pdf

CSR Policy at https://www.ayefin.com/wp-content/uploads/2024/06/Corporate-Social-Responsibility-Policy.pdf

CSR projects at https://www.ayefin.com/corporate-social-responsibility/

4. 
Provide the executive summary along with web-link(s) of Impact Assessment of CSR Projects carried out in pursuance
of sub rule (3) of rule 8, if applicable: NA

5. (a) Average net profit of the Company as per sub-section (5) of section 135 – ` 8,83,34,156

(b) Two percent of average net profit of the Company as per sub-section (5) of section 135 – ` 17,66,683

(c) Surplus arising out of the CSR Projects or programmes or activities of the previous financial years – Nil

(d) Amount required to be set-off for the financial year, if any – Nil

(e) Total CSR obligation for the financial year [(b)+(c)-(d)] - ` 17,66,683

6. (a) Amount spent on CSR Projects (both Ongoing Project and other than Ongoing Project) – ` 94,55,198

(b) Amount spent in Administrative Overheads – Nil

(c) Amount spent on Impact Assessment, if applicable – Nil

54 Annual Report 2023-24

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ANNUAL REPORT ON CSR ACTIVITIES FOR FINANCIAL YEAR 2023-24 (CONTD.)

(d) Total amount spent for the Financial Year [(a)+(b)+(c)] – ` 94,55,198

(e) CSR amount spent or unspent for the Financial Year:

Total Amount Amount Unspent (in `)

Spent for
the Financial Total Amount transferred to Unspent Amount transferred to any fund specified under Schedule
Year CSR Account as per sub-section (6) VII as per second proviso to sub-section (5) of section
(in `) of section 135 135
Amount Date of transfer Name of the Fund Amount Date of transfer
NA

(f) Excess amount for set-off, if any:

Sl. Particular Amount

No.
(1) (2) (3)
(i) Two percent of average net profit of the Company as per sub-section (5) of section 135
(ii) Total amount spent for the Financial Year
(iii) Excess amount spent for the Financial Year [(ii)-(i)]
Nil
(iv) Surplus arising out of the CSR projects or programmes or activities of the previous
Financial Years, if any
(v) Amount available for set off in succeeding Financial Years [(iii)-(iv)]

7. Details of Unspent Corporate Social Responsibility amount for the preceding three Financial Years:

1 2 3 4 5 6 7 8
Sl. Preceding Amount Balance Amount Amount transferred Amount Deficiency,
No. Financial transferred Amount in Spent in the to a Fund as specified remaining if any
Year(s) to Unspent Unspent Financial under Schedule VII as to be
CSR CSR (in `) Year (in `) per second proviso spent in
Account to sub- section (5) of succeeding
under sub- section 135, if any Financial
section (6) Amount Date of Years (in `)
of section (in `) Transfer
135 (in `)
2022-23 Nil
2021-22 Nil
2020-21 Nil

8. 
Whether any capital assets have been created or acquired through Corporate Social Responsibility amount spent in the
Financial Year: No

9. 
Specify the reason(s), if the Company has failed to spend two per cent of the average net profit as per sub-section (5)
of section 135: NA

For and on behalf of the Board of Directors of

Aye Finance Private Limited

Sd/- Sd/-
Kanika Tandon Bhal Sanjay Sharma
Chairperson - Corporate Social Responsibility Committee Managing Director
DIN: 06944916 DIN: 03337545
Date: September 19, 2024 Place: Delhi Place: Gurugram

Aye Finance Private Limited 55

ANNEXURE-C
FORM NO. MR-3
SECRETARIAL AUDIT REPORT
FOR THE FINANCIAL YEAR ENDED March 31, 2024
[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies
(Appointment and Remuneration Personnel) Rules, 2014]

To,

The Members,
AYE Finance Private Limited
M-5, Magnum House-I,
Community Centre,
Karampura, New Delhi-110015

We have conducted the secretarial audit of the compliance of applicable statutory provisions and corporate practices adhered
by Aye Finance Private Limited (hereinafter called the “Company”). Secretarial Audit was conducted in a manner that provided
us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing my opinion thereon.

Based on our verification of the Company’s books, papers, minute books, forms, website and returns filed and other records
maintained by the Company, to the extent the information provided by the Company, its officer (Company Secretary),
agents, authorised representatives during the conduct of secretarial audit, the explanations and clarifications given to
us. We hereby report that in my opinion, the Company has, during the audit period covering the financial year ended on
March 31, 2024 complied with the statutory provisions listed hereunder and also that the Company has proper Board
processes and compliance mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company
for the financial year ended on March 31, 2024 according to the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made thereunder;

(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made there under;

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws Framed thereunder;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to extent of Foreign Direct
Investment and External Commercial Borrowings (ECB).

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992
(‘SEBI Act’):-

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;
(Not Applicable)

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;

(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018;
(Not Applicable)

(d) The Securities and Exchange Board of India (Shares Based Employee Benefit Regulation), 2014; (Not Applicable)

(e) The Securities and Exchange Board of India (Issue and Listing of Non-Convertible Securities) Regulations, 2021;

(f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993
regarding the Companies Act and dealing with client;

(g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; and (Not Applicable)

(h) The Securities and Exchange Board of India (Buy back of Securities) Regulations, 2018; (Not Applicable)

(i) Other regulations as applicable and including any Circulars and Guidelines issued therein.

56 Annual Report 2023-24

 Statutory Reports

SECRETARIAL AUDIT REPORT (CONTD.)

(vi) the other laws and regulations applicable on the Company are mentioned below:

(a) SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

(b) Specific requirement for NBFC under RBI Acts, Regulations, Directions, Notifications and amendments from time to
time by RBI.

We have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India with respect to Board and General
Meetings.

(ii) The Listing Agreements entered into by the Company with BSE Limited or Stock Exchange(s),if applicable;

During the period under review, the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines,
Standards, etc. as mentioned above.

We further report that:

The Board of Directors of the Company is duly constituted 1. Mr. Sanjaya Gupta (DIN- 02939128) was appointed as
with proper balance of Executive Directors, Non-Executive Independent Director of the Company in the EGM held on
Directors and Independent Directors. The changes in the September 01, 2023.
composition of the Board of Directors that took place during 2. Mr. Govinda Rajulu Chintala (DIN-03622371) was
the period under review were carried out in compliance with appointed as Independent Director of the Company in the
the provisions of the Act. EGM held on September 01, 2023. Mr. Chintala was also
designated as Chairperson of the Board effective from
January 05, 2024
3. Ms. Kanika Tandon Bhal (DIN- 06944916, Independent
Director) appointed as Independent Director of the
Company in the EGM held September 01, 2023.
4. Mr. Navin Kumar Maini (DIN–00419921) resigned as
Independent Director of the Company effective from
September 02, 2023.
5. Mrs. Arpita Pal Agrawal (DIN–08588528) resigned as
Independent Director of the Company effective from
September 02, 2023.
6. Mr. Vinay Baijal (DIN – 07516339) resigned as Independent
Director of the Company effective from September 02,
2023.
Adequate notice was given to all the directors to schedule Some of the Board/Committee meetings were called on
the Board Meetings. Agenda and detailed notes on agenda shorter notice in compliance of the applicable provisions
were sent at least seven days in advance other than those of Companies Act, SS-1 and Articles of Association of the
held on shorter notice and a system exists for seeking Company. Apart from that, the meetings were called by
and obtaining further information and clarifications on giving proper notice and agenda was also circulated in timely
the agenda items before the meeting and for meaningful manner.
participation at the meeting.
Majority decisions are carried through while the dissenting All the resolutions were passed by the majority.
members’ views are captured and recorded as part of the
minutes,

Aye Finance Private Limited 57

SECRETARIAL AUDIT REPORT (CONTD.)

We further report that there are adequate systems and There are adequate systems and process in the Company
processes in the Company commensurate with the size commensurate with the size and operations of the Company
and operations of the Company to monitor and ensure to monitor and ensure compliance with applicable rules,
compliance with applicable laws, rules, regulations and regulations and guidelines.
guidelines.

We further report that during the audit period the Company has issued and allotted non-convertible debentures (listed and
unlisted) through private placement basis and had also redeemed non-convertible debentures (listed and unlisted) as per the
terms of issue.

for: Brajesh Kumar & Associates

Company Secretary
UIN: S2007DE093900

Place: Delhi Brajesh Kumar

Date: 20/05/2024 FCS No.: 6965, CP No.:7497
UDIN-F006965F000407521 PR: 5461/2024

58 Annual Report 2023-24

 Statutory Reports

CORPORATE GOVERNANCE REPORT

Corporate Governance is about promoting fairness, transparency, accountability, commitment to values, ethical business
conduct and about considering all stakeholders’ interest while conducting business.

This Report outlines the requirements in accordance with Master Direction – Reserve Bank of India (Non-Banking Financial
Company – Scale Based Regulation) Directions, 2023, (“RBI Master Directions”) [including any amendment(s), enactment(s)
or re-enactment(s) thereof for the time being in force), as applicable to the Aye Finance Private Limited (‘the Company’).

(A) Board of Directors

Keeping with the commitment to the principle of integrity and transparency in business operations for good corporate
governance, the Company’s policy is to have an appropriate blend of Independent and Non‑Independent Directors to
maintain the independence of the Board and to separate the Board functions of governance and management.

The responsibilities of the Board, inter alia, include formulation of overall strategy for the Company, reviewing major plan
of actions, setting performance objectives, laying down the code of conduct for all members of the Board and senior
management team, formulating policies, conducting performance review, monitoring due compliance with applicable
laws, reviewing and approving the financial results, enhancing corporate governance practices and ensuring the best
interest of the stakeholders, the community and environment.

(i) Composition of the Board during the FY 2023-24:

Sr. Name of the DIN Category/ Director No. of Board Total Remuneration No. of
No. Director Designation since meetings held Number shares
during the FY of other held in and
2023-24 Directorship convertible
held instruments
Held Attended Salary Sitting Commission held in the
and other fee Company
compensation
1. Mr. Vinay 07516339 Non- February 11 3 2 Nil 4,20,000 Nil Nil
Baijal* Executive & 21, 2019
Independent
Director
2. Mr. Navin 00419921 Non- July 18, 11 4 2 Nil 4,90,000 Nil Nil
Kumar Executive & 2017
Maini* Independent
Director
3. Ms. Arpita 08588528 Non- September 11 3 1 Nil 3,15,000 Nil Nil
Pal Agrawal* Executive & 29, 2022
Independent
Director
4. Dr. Govinda 03622371 Chairperson, September 11 6 4 Nil 7,25,000 Nil Nil
Rajulu Non- 1, 2023
Chintala# Executive &
Independent
Director ^
5. Mr. Sanjay 03337545 Managing November 11 11 1 3,52,02,342 Nil Nil 19,29,126
Sharma Director 27, 2013
6. Ms. Kanika 06944916 Non- September 11 7 2 Nil 5,95,000 Nil Nil
Tandon Executive & 1, 2023
Bhal# Independent
Director
7. Mr. Kartik 03559152 Non- February 11 8 12 Nil Nil Nil Nil
Srivatsa Executive 20, 2020
& Non-
Independent
Director

Aye Finance Private Limited 59

CORPORATE GOVERNANCE REPORT (CONTD.)

Sr. Name of the DIN Category/ Director No. of Board Total Remuneration No. of
No. Director Designation since meetings held Number shares
during the FY of other held in and
2023-24 Directorship convertible
held instruments
Held Attended Salary Sitting Commission held in the
and other fee Company
compensation
8. Mr. Kaushik 07719742 Non- October 9, 11 9 3 Nil Nil Nil Nil
Anand Executive 2020
Kalyana & Non-
Krishnan Independent
Director
9. Mr. Navroz 08355220 Non- March 12, 11 4 11 Nil Nil Nil Nil
Darius Executive 2019
Udwadia & Non-
Independent
Director
10. Mr. Sanjaya 02939128 Non- September 11 5 1 Nil 6,65,000 Nil Nil
Gupta# Executive & 1, 2023
Independent
Director
11. Mr. Vivek 03581311 Non- June 29, 11 6 2 Nil Nil Nil Nil
Kumar Executive 2016
Mathur & Non-
Independent
Director


#
Dr. Govinda Rajulu Chintala, Mr. Sanjaya Gupta and Ms. Kanika Tandon Bhal were appointed as Independent
Directors on the Board of the Company w.e.f. September 1, 2023. During their tenure, they were entitled to attend 7
meetings.

^ Dr. Govinda Rajulu Chintala has been appointed as Chairperson of the Board w.e.f. January 5, 2024.

*Mr. Vinay Baijal, Mr. Navin Kumar Maini & Ms. Arpita Pal Agrawal were resigned from the post of Independent
Director w.e.f. September 2, 2023. During their tenure, they were entitled to attend 4 meetings.

(ii) Details of change in the composition of the Board during the current and previous financial year:
F.Y. Sr. Name of Director Category/ Designation Nature of Effective Reason of
No. Change Date Resignation
1. Dr. Govinda Rajulu Non-Executive & Appointment September 1, Not
Chintala Independent Director 2023 Applicable
(DIN: 03622371)
2. Mr. Sanjaya Gupta Non-Executive & Appointment September 1, Not
(DIN: 02939128) Independent Director 2023 Applicable
3. Ms. Kanika Tandon Bhal Non-Executive & Appointment September 1, Not
2023-24 (DIN: 06944916) Independent Director 2023 Applicable
4. Mr. Navin Kumar Maini Non-Executive & Resignation September 2, Personal
(DIN: 00419921) Independent Director 2023
5. Mr. Vinay Baijal Non-Executive & Resignation September 2, Personal
(DIN: 07516339) Independent Director 2023
6. Ms. Arpita Pal Agrawal Non-Executive & Resignation September 2, Personal
(DIN: 08588528) Independent Director 2023

60 Annual Report 2023-24

 Statutory Reports

CORPORATE GOVERNANCE REPORT (CONTD.)

F.Y. Sr. Name of Director Category/ Designation Nature of Effective Reason of

No. Change Date Resignation
1. Mr. Sumiran Das Non-Executive & Non- Resignation March 9, Personal
(DIN: 08357729) Independent Director 2023
2. Ms. Kanika Tandon Bhal Non-Executive & Resignation September 1, Personal
(DIN: 06944916) Independent Director 2022
2022-23
3. Mr. Navin Kumar Maini Non-Executive & Re- July 13, 2022 Not
(DIN: 00419921) Independent Director appointment Applicable
4. Ms. Arpita Pal Agrawal Non-Executive & Appointment September Not
(DIN: 08588528) Independent Director 29, 2022 Applicable

There is no relationship amongst the Directors of the Company.

(B) COMMITTEES OF THE BOARD

(i) AUDIT COMMITTEE

a) Composition, Meetings and Attendance
During the year under review, the Audit Committee (“Committee”) met 8 (eight) times on May 23, 2023, June
13, 2023, August 10, 2023, August 28, 2023, September 4, 2023, November 9, 2023, February 12, 2024 and
March 27, 2024, of which the details of attendance are given below:

Sr. Name of Member Category/ Designation Member of No. of meetings held No. of shares
No. Committee during the FY 2023-24 held in the
since Total no. of Attended Company
meetings
1. Dr. Govinda Rajulu Chairperson September 3, 8 4 Nil
Chintala# (Non-Executive & 2023
Independent Director)
2. Mr. Sanjaya Member September 3, 8 3 Nil
Gupta# (Non-Executive & 2023
Independent Director)
3. Mr. Sanjay Member February 28, 8 8 9,79,750
Sharma (Managing Director) 2020
4. Mr. Vinay Baijal* Chairperson April 24, 2019 8 4 Nil
(Non-Executive &
Independent Director)
5. Mr. Navin Kumar Member May 9, 2018 8 4 Nil
Maini* (Non-Executive &
Independent Director)

*Mr. Vinay Baijal and Mr. Navin Kumar Maini had resigned from the position of Independent Director w.e.f.
September 2, 2023 due to which they ceased to be chairperson and member of Audit Committee respectively.
During their tenure, they were entitled to attend 4 meetings.


#
Dr. Govinda Rajulu Chintala and Mr. Sanjaya Gupta were appointed as Chairperson & member of the Audit
Committee, respectively w.e.f. September 3, 2023. During their tenure, they were entitled to attend 4 meetings.

Aye Finance Private Limited 61

CORPORATE GOVERNANCE REPORT (CONTD.)

b) Terms of reference • 
Review and monitor the auditor’s
The terms of reference of Committee inter- independence and performance, and
alia include: effectiveness of audit process.
iii) Compliance
i) Financial Statements
• Monitor, review and assess compliance
• 
To review the following documents
and corporate governance processes
as and when required before their
within the company.
submission to the Board.
• Ensure adherence to all relevant
• Review, and challenge where necessary,
regulations, industry codes and legal
the actions and judgments of
requirements in each of the markets
management, in relation to the interim
where the Company is represented.
and annual financial statements before
submission to the Board. • 
Approval or any subsequent
modification of transactions of
• Monitoring the end use of funds raised the company with related parties.
through public offers and related However, the Audit Committee may
matters. make omnibus approval for related
• Scrutiny of inter-corporate loans and party transactions proposed to be
investments. entered into by the company subject
to the conditions as detailed in the
ii) Audit & Risk Management Related Party Transaction Policy of the
• Review the effectiveness of the Audit Company.
function, including compliance with • 
Provided further that in case of
standards for internal auditing, risk transaction, other than transactions
management, corporate governance referred to in section 188 and where
and compliance. Audit Committee does not approve
• 
Authorise and consider the the transaction, it shall make its
effectiveness of the Company’s audit recommendations to the Board.
management framework. • 
Provided also that in case any
• 
Authorise and consider the transaction involving any amount
effectiveness of the Company’s fraud not exceeding one crore rupees is
management framework. entered into by a director or officer of
the company without obtaining the
• Review the Company’s procedures for
approval of the Audit Committee and it
detecting fraud and whistle blowing and
is not ratified by the Audit Committee
ensure that arrangements are in place
within three months from the date of
by which staff and the general public
the transaction, such transaction shall
may, in confidence, raise concerns
be voidable at the option of the Audit
about possible improprieties in matters
Committee and if the transaction is
of financial reporting, financial control
with the related party to any director or
or any other matters.
is authorized by any other director.
• Ensure there are no unjustified
restrictions or limitations, and review • the director concerned shall indemnify
and concur in the appointment, the company against any loss incurred
replacement, or dismissal of the Chief by him.
Risk Officer and Head of Audit & • In addition to the above duties and
Vigilance. responsibilities, the Audit Committee
• The recommendation for appointment, shall also be responsible for:
remuneration, rotation and terms
 to monitor Vigil Mechanism of the
of appointment of auditors of the
Company and
company.

62 Annual Report 2023-24

 Statutory Reports

CORPORATE GOVERNANCE REPORT (CONTD.)

 Ensure Information System the audit plans reflects the terms of the
Audit of the internal systems and engagement letter.
processes is conducted at least
• Review the external auditors’ internal
once a year to assess operational
quality control procedures and steps
risks faced by the Company.
taken by the auditors to respond
iv) Internal Audit to changes in regulatory and other
• 
Review the framework and requirements.
effectiveness of the Company’s • Assess the performance and review
systems of the internal control. and monitor the independence and
• Review management’s and Audit & objectivity of the external auditors and
Risk Management’s reports on the the effectiveness of their audit process.
effectiveness of the systems for • Review annually the qualifications,
internal financial control, financial expertise, resources and economic
reporting. service of the external auditors and
• Valuation of undertakings or assets of their audit process.
the company, wherever it is necessary. • 
Consider management’s response
v) External Audit to any major external audit
recommendations and ensure that
• At the beginning of each audit cycle,
actionables are implemented by
to ensure that appropriate plans are in
management satisfactorily.
place for the audit and that the scope of

(ii) RISK MANAGEMENT COMMITTEE

a) Composition, Meetings and Attendance
During the year under review, the Risk Management Committee (“RMC”) met 4 (four) times on June 22, 2023,
September 26, 2023, November 28, 2023 and February 22, 2024, of which the details of attendance are given
below:

Sr. Name of Member Category/ Designation Member of No. of meetings held No. of shares
No. Committee during the FY 2023-2024 held in the
since Total no. of Attended Company
meetings
1. Mr. Sanjaya Chairperson September 3, 4 3 Nil
Gupta# (Non-Executive & 2023
Independent Director)
2. Dr. Govinda Rajulu Member September 3, 4 2 Nil
Chintala# (Non-Executive & 2023
Independent Director)
3. Mr. Sanjay Member February 28, 4 4 9,79,750
Sharma (Managing Director) 2020
4. Mr. Navin Kumar Chairperson May 9, 2018 4 1 Nil
Maini* (Non-Executive &
Independent Director)
5. Mr. Vinay Baijal* Member April 24, 2019 4 1 Nil
(Non-Executive &
Independent Director)

*Mr. Vinay Baijal and Mr. Navin Kumar Maini had resigned from the position of Independent Director w.e.f.
September 2, 2023 due to which they ceased to be the members of RMC. During their tenure, they were entitled
to attend 1 meeting.
#
Mr. Sanjaya Gupta and Dr. Govinda Rajulu Chintala were appointed as Chairperson & member of the RMC,
respectively w.e.f. September 3, 2023. During their tenure, they were entitled to attend 3 meetings.

Aye Finance Private Limited 63

CORPORATE GOVERNANCE REPORT (CONTD.)

b) Terms of Reference • 
Reviews management’s response to
The terms of reference of RMC inter-alia any major audit recommendations
include: and ensure that actionables are
implemented by management
• Assesses the Company’s risk profile, satisfactorily.
key areas of risk and recommend
acceptable levels of risk through risk • Ensures that the risk awareness
appetite statement. culture is pervasive throughout the
organization.
• Articulates the Company’s policy for
the oversight and management of • Reviews the trends on the Company’s
business risks. risk profile, reports on specific risks
and the status of the risk management
• 
Develops and implement a risk process.
management framework and internal
control system. • 
Reviews processes and procedures
to ensure the effectiveness of internal
• 
Reviews and assesses the nature, systems of control so that decision-
role, responsibility and authority of the making capability and accuracy of
risk management function within the reporting and financial results are
Company and outline the scope of risk always maintained at an optimal level.
management work.
• Reviews the risk bearing capacity of
• Ensures that infrastructure, resources the Company in light of its reserves,
and systems are in place for risk insurance coverage, guarantee funds or
management is adequate to maintain other such financial structures.
a satisfactory level of risk management
discipline. • 
Reviews records of all material
outsourcing arrangements on a
• 
Reviews and assesses the quality,
periodic basis.
integrity and effectiveness of the risk
management systems and ensure that • Makes special investigations into areas
the risk policies and strategies are of corporate risk and breakdowns in
effectively managed. internal control.

• Ensures that a systematic, documented • Monitors external developments

assessment of the processes and relating to the practice of corporate
outcomes surrounding key risks is accountability and the reporting of
undertaken at least annually for the specifically associated risk, including
purpose of making its public statement emerging and prospective impacts.
on risk management including internal
• 
Performs other activities related to
control.
risk management as requested by the
• Ensures that risk is not higher than the Board of Directors or to address issues
risk appetite determined by the Board. related to any significant subject within
• Provides an independent and objective its term of reference.
oversight and view of the information • Provides updates to the Board about the
presented by the management discussions in the Risk Management
on corporate accountability and Committee as well as provides detailed
specifically associated risk, also reports on matters of importance on
taking account of reports by the being requested by the Board.
Audit Committee to the Board on all
categories of identified risks facing by
the Company.

64 Annual Report 2023-24

 Statutory Reports

CORPORATE GOVERNANCE REPORT (CONTD.)

(iii) STAKEHOLDERS RELATIONSHIP COMMITTEE

a) Composition, Meetings and Attendance
During the year under review, Stakeholders Relationship Committee (“SRC”) met 2 (two) times on July 31,
2023 and January 22, 2024, of which the details of attendance are given below:

Sr. Name of the Category/ Designation Member of No. of meetings held No. of
No. Member Committee during the FY 2023-2024 Shares
since Total no. of Attended held in the
meetings Company

1. Dr. Govinda Rajulu Chairperson September 3, 2 1 Nil

Chintala# (Non-Executive & 2023
Independent Director)
2. Mr. Sanjay Member May 23, 2023 2 2 9,79,750
Sharma (Managing Director)
3. Mr. Vivek Kumar Member May 23, 2023 2 2 Nil
Mathur (Non-Executive & Non-
Independent Director)
4. Ms. Arpita Pal Chairperson May 23, 2023 2 1 Nil
Agrawal* (Non-Executive &
Independent Director)
*Ms. Arpita Pal Agrawal had resigned from the position of Independent Director w.e.f. September 2, 2023 due
to which she ceased to be the Chairperson of the SRC. During her tenure, she was entitled to attend 1 meeting.

#Dr. Govinda Rajulu Chintala was appointed as Chairperson of the SRC w.e.f. September 3, 2023. During his
tenure, he was entitled to attend 1 meeting.

b) Terms of Reference
The terms of reference of SRC inter-alia include:
• Resolving the grievances of the stakeholders of the listed entity including complaints related to transfer/
transmission of shares, non-receipt of annual report, non-receipt of declared dividends, issue of new/
duplicate certificates, general meetings etc.
• Review of measures taken for effective exercise of voting rights by stakeholders.
• Review of adherence to the service standards adopted by the listed entity in respect of various services
being rendered by the Registrar & Share Transfer Agent.
• Review of the various measures and initiatives taken by the listed entity for reducing the quantum of
unclaimed dividends/interest/principal amount and ensuring timely receipt of interest payments/principal
repayments/dividend warrants/annual reports/statutory notices by the stakeholders of the company.
• The Committee shall lay down policies, procedures and ask for report on status of compliances and
various measures taken.

(iv) CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

a) Composition, Meetings and Attendance
During the year under review, Corporate Social Responsibility Committee (“CSR”) met 2 (two) times on May 19,
2023 and November 24, 2023, of which the details of attendance are given below:

Sr. Name of the Category/ Designation Member of No. of meetings held No. of
No. Members Committee during the FY 2023-24 Shares
since Total no. of Attended held in the
meetings Company
1. Ms. Kanika Chairperson September 3, 2 1 Nil
Tandon Bhal# (Non-Executive & 2023
Independent Director)

Aye Finance Private Limited 65

CORPORATE GOVERNANCE REPORT (CONTD.)

Sr. Name of the Category/ Designation Member of No. of meetings held No. of
No. Members Committee during the FY 2023-24 Shares
since Total no. of Attended held in the
meetings Company
2. Mr. Kartik Srivatsa Member February 28, 2 1 Nil
(Non-Executive & Non- 2020,
Independent Director)
3. Mr. Sanjay Member April 24, 2019 2 2 9,79,750
Sharma (Managing Director)

4. Ms. Arpita Pal Chairperson October 4, 2 1 Nil

Agrawal* (Non-Executive & Non- 2022
Independent Director)
*Ms. Arpita Pal Agrawal had resigned from the position of Independent Director w.e.f. September 2, 2023 due
to which she ceased to be the Chairperson of the CSR Committee. During her tenure, she was entitled to attend
1 meeting.


#
Ms. Kanika Tandon Bhal was appointed as Chairperson of the CSR Committee w.e.f. September 3, 2023.
During her tenure, she was entitled to attend 1 meeting.

b) Terms of Reference
The terms of reference of CSR inter-alia include:

• Formulate CSR policy and seek approval from the Board of Directors. Also, review the policy on a yearly
basis.

• Formulate and share the CSR action plan with budget for the year with the Board of Directors and seek
approval. Implement the activities either through its Section 8 Company-Foundation for Advancement of
Micro Enterprises (FAME) or directly through its own team or through any other permitted mode.

• Monitors the spending of the allocated amount on CSR activities once approved by the Board of Directors
and create a transparent monitoring mechanism of CSR initiatives.

• Submit periodic reports (once in six months at the minimum) to the Board for the activities undertaken.

• Monitors the Corporate Social Responsibility Policy of the company from time to time.

(v) NOMINATION AND REMUNERATION COMMITTEE

a) Composition, Meetings and Attendance
During the year under review, the Nomination and Remuneration Committee (“NRC”) met 7 (seven) times on
April 4, 2023, May 22, 2023, July 6, 2023, August 9, 2023, August 31, 2023, December 28, 2023 and March 20,
2024, of which the details of attendance are given below:

Sr. Name of Category/ Designation Member of No. of meetings held No. of

No. Members Committee during the FY 2023-24 Shares
since Total no. of Attended held in the
meetings Company
1. Ms. Kanika Chairperson September 3, 7 2 Nil
Tandon Bhal# (Non-Executive & 2023
Independent Director)
2. Mr. Sanjaya Member September 3, 7 2 Nil
Gupta# (Non-Executive & 2023
Independent Director)

66 Annual Report 2023-24

 Statutory Reports

CORPORATE GOVERNANCE REPORT (CONTD.)

Sr. Name of Category/ Designation Member of No. of meetings held No. of

No. Members Committee during the FY 2023-24 Shares
since Total no. of Attended held in the
meetings Company
3. Mr. Kaushik Member October 9, 7 7 Nil
Anand Kalyana (Non-Executive & Non- 2020
Krishnan Independent Director)
4. Mr. Kartik Member February 28, 7 4 Nil
Srivatsa^ (Non-Executive & Non- 2020
Independent Director)
5. Mr. Vinay Baijal* Chairperson September 1, 7 5 Nil
(Non-Executive & 2022
Independent Director)
6. Mr. Navin Kumar Member May 9, 2018 7 5 Nil
Maini* (Non-Executive &
Independent Director)

*Mr. Vinay Baijal and Mr. Navin Kumar Maini had resigned from the position of Independent Director w.e.f.
September 2, 2023 due to which they ceased to be the Chairperson & member of the NRC respectively. During
their tenure, they were entitled to attend 5 meetings.


#
Ms. Kanika Tandon Bhal and Mr. Sanjaya Gupta were appointed as Chairperson & member respectively of the
NRC w.e.f. September 3, 2023. During their tenure, they were entitled to attend 2 meetings.

^Mr. Kartik Srivatsa ceased to be a member and appointed as observer in the NRC w.e.f. January 5, 2024.

b) Terms of Reference
The terms of reference of NRC inter-alia include:

• Review and recommend to the Board the size and composition of the Board, including review of Board
succession plans and the succession of the Chairman and CEO.

• Assist the Board as required to identify individuals who are qualified to become Board members (including
in respect of executive directors).

• Review and recommend to the Board on the appointment and re-appointment of directors, and where
necessary propose candidates for consideration by the Board, subject to the principle that a committee
member must not be involved in making recommendations to the Board in respect of themselves.

• Assist the Board as required in relation to the performance evaluation of the Board, its committees and
individual directors, and in developing and implementing plans for identifying, assessing and enhancing
director competencies.

• Review and make recommendations in relation to any corporate governance issues as requested by the
Board from time to time in terms of the applicable laws.

• Review the time expected to be devoted by non-executive directors in relation to the Company’s affairs.

• Ensure that an effective induction process is in place for any newly appointed director and regularly
review its effectiveness.

Aye Finance Private Limited 67

CORPORATE GOVERNANCE REPORT (CONTD.)

(vi) ASSET AND LIABILITIES COMMITTEE

a) Composition, Meetings and Attendance
During the year under review, the Asset and Liabilities Committee (“ALCO”) met 4 (four) times on June 6, 2023,
August 18, 2023, November 23, 2023 and February 19, 2024, of which the details of attendance are given
below:

Sr. Name of Category/ Designation Member of No. of meetings held No. of

No. Members Committee during the FY 2023-24 Shares
since Total no. of Attended held in the
meetings Company
1. Mr. Sanjay Chairperson January 12, 4 4 9,79,750
Sharma (Managing Director) 2016
2. Mr. Vivek Kumar Member January 12, 4 4 Nil
Mathur (Non-Executive & Non- 2016
Independent Director)
3. Mr. Navroz Darius Member April 24, 2020 4 0 Nil
Udwadia (Non-Executive & Non-
Independent Director)
4. Mr. Utsav Mitra Member December 11, 4 0 Nil
(Representative - Alpha 2020
Wave India I LP)
5. Mr. Krishan Member September 3, 4 3 Nil
Gopal* (Chief Financial 2023
Officer)
6. Mr. Niraj Kaushik* Member September 3, 4 2 Nil
(Deputy CEO) 2023
7. Mr. Kapil Goyal# Member (Head of February 12, 4 1 Nil
Internal Audit) 2024
8. Mr. Ujual George# Member (Chief March 23, 2021 4 0 Nil
Operating Officer)
9. Mr. Samir Mehta^ Member (Deputy CEO) December 11, 4 1 Nil
2020
*Mr. Krishan Gopal and Mr. Niraj Kaushik were appointed as members of ALCO w.e.f. September 3, 2023.
During their tenure, they were entitled to attend 2 meetings.

#
Mr. Kapil Goyal became member of ALCO w.e.f. September 3, 2023, at the place of Mr. Ujual George. Mr. Kapil
was entitled to attend 1 meeting and Mr. Ujual was entitled to attend 3 meetings.
^Mr. Samir Mehta ceased to be the member of ALCO due to his resignation from the position of Deputy-CEO
w.e.f. June 30, 2023. During his tenure, he was entitled to attend 1 meeting.

b) Terms of Reference
The terms of reference of ALCO inter-alia include:

i) Funding and Liquidity

• Exert principal oversight over the appropriate funding arrangements of the Company’s by referencing its
earnings performance and business growth goal.

• Periodically review all key policies governing capital, asset/liability management, investment (including
portfolio limits), funding, retained earnings, pricing and recommending final versions for approval by the
full Board and monitor compliance with the policies.

• Periodically review the Capital structure plans and strategies.

68 Annual Report 2023-24

 Statutory Reports

CORPORATE GOVERNANCE REPORT (CONTD.)

• Periodically review the volume and mix of the Company’s assets, liabilities and funding sources in light of
liquidity, capital, profitability and market risk considerations.

• Periodically review and approve the term loan requirements and other credit facilities of the Company as
per the delegation from the Board from time to time.

• Determine variances in cash flows and the reason for the same. Monitor cost of funds associated with
such mismatches.

ii) Investments

• Review and amend the Investment policy of the Company in terms of requirement of the Company.

• Review the investments made by the Company and ensure that the investment and asset allocation
correspond with Company policy.

iii) Profitability

• Review interest rate risk scenario and suggest strategy.

• Review the product pricing objectives, policies, strategy, plans, the past performance against plans
and future projections of revenue and profits from currently operational and proposed plans as per
requirement.

• Review profit rate spreads to ensure compliance with minimum requirements for spreads.

iv) Other Responsibilities

• Perform activities with respect to any matters related to the Committee’s purpose and requiring Board or
management attention or specifically requested by the Board.

• Form and delegate authority to working committees when appropriate.

• Evaluate the Committee’s and individual member’s performance at least annually.

• Ensure that the Committee is provided with sufficient resources to undertake its duties.

(vii) IT STRATEGY COMMITTEE

a) Composition, Meetings and Attendance
During the year under review, the IT Strategy Committee (“ITSC”) met 2 (two) times on July 10, 2023 and
January 8, 2024, of which the details of attendance are given below:

Sr. Name of Category/ Designation Member of No. of meetings held No. of

No. Members Committee during the FY 2023-24 Shares
since Total no. of Attended held in the
meetings Company
1. Mr. Sanjaya Chairperson September 3, 2 1 Nil
Gupta* (Non-Executive & 2023
Independent Director)
2. Mr. Sanjay Member August 30, 2 2 9,79,750
Sharma (Managing Director) 2018
3. Mr. Niraj Kaushik Member March 25, 2019 2 2 Nil
(Deputy CEO)
4. Mr. Krishan Member September 3, 2 1 Nil
Gopal* (Chief Financial 2023
Officer)
5. Mr. Ujual George Member December 21, 2 2 Nil
(Chief Operating 2020
Officer)

Aye Finance Private Limited 69

CORPORATE GOVERNANCE REPORT (CONTD.)

Sr. Name of Category/ Designation Member of No. of meetings held No. of

No. Members Committee during the FY 2023-24 Shares
since Total no. of Attended held in the
meetings Company
6. Mr. Jinu Joseph Member January 24, 2 2 Nil
(Chief Technology 2023
Officer)
7. Mr. Kaushik Member February 12, 2 0 Nil
Anand Kalyana (Non-Executive & Non- 2024
Krishnan# Independent Director)
8. Ms. Arpita Pal Chairperson October 4, 2 1 Nil
Agrawal^ (Non-Executive & 2022
Independent Director)

*Mr. Sanjaya Gupta & Mr. Krishan Gopal were appointed as Chairperson & member of ITSC respectively w.e.f.
September 3, 2023. During their tenure, they were entitled to attend 1 meeting.

#Mr. Kaushik Anand Kalyana Krishnan were appointed as member of ITSC w.e.f. February 12, 2024.

^Ms. Arpita Pal Agrawal resigned from the position of Independent Director w.e.f. September 02, 2023 due to
which she ceased to be the Chairperson of ITSC. During her tenure, she was entitled to attend 1 meeting.

b) Terms of Reference
IT security), cyber security are
The terms of reference of ITSC inter-alia commensurate with the RE’s IT maturity,
include: digital depth, threat environment and
• Approving IT strategy and policy industry standards and are utilised in a
documents and ensuring that the manner intended for meeting the stated
management has put an effective objectives; and
strategic planning process in place. • Review, at least on annual basis, the
• Guide in preparation of IT Strategy adequacy and effectiveness of the
and ensure that the IT Strategy aligns Business Continuity Planning and
with the overall strategy towards Disaster Recovery Management.
accomplishment of its business • Reviewing and amending IT strategies
objectives. in line with corporate strategies,
• Satisfy itself that the IT Governance board policy reviews, cyber security
and Information Security Governance arrangements and any other matter
structure fosters accountability, is related to IT governance.
effective and efficient, has adequate • Ensuring IT investments represent a
skilled resources, well defined objectives balance of risks and benefits and that
and unambiguous responsibilities for budgets are acceptable.
each level in the organisation.
• Ensuring proper balance of IT
• Ensure that the Organization has put investments for sustaining company’s
in place processes for assessing and growth and becoming aware about
managing IT and cybersecurity risks. exposure towards IT risks and controls.
• Ensure that the budgetary allocations • Reviewing Cyber Security KPIs and RBI
for the IT function (including for Compliance.

70 Annual Report 2023-24

 Statutory Reports

CORPORATE GOVERNANCE REPORT (CONTD.)

(C) GENERAL BODY MEETINGS

The details of the General Meetings held during the FY 2023-24 are as follows:

Sr. Type of Meeting Date and Place Special Resolution(s) passed

No. (Annual/ Extra-Ordinary)
1. Extra-Ordinary General Date: September 1, 2023 To approve the amendment of Articles of Association
Meeting of the Company.
Place: Meeting conducted
through VC / OAVM pursuant
to the MCA Circulars deemed
to be held at Corporate Office
of the Company
2. 30th Annual General Date: September 29, 2023 1. 
To consider, discuss and approve the blanket
Meeting borrowing limit of ` 4,000 crore (Rupees Four
Place: Meeting conducted
Thousand Crore Only)
through VC / OAVM pursuant
to the MCA Circulars deemed 2. To consider, discuss and approve the issuance
to be held at Registered Office of Non-Convertible Debentures amounting upto
of the Company ` 3,000 Crore (Rupees Three Thousand Crore Only)
3. Extra-Ordinary General Date: December 12, 2023 To create, offer, issue and allot 20 (Twenty) equity
Meeting shares and 47,39,244 (Forty-Seven Lakhs Thirty-Nine
Place: Meeting conducted
Thousand Two Hundred and Forty-Four only) Series
through VC / OAVM pursuant
F compulsory convertible preference shares (“Series
to the MCA Circulars deemed
F CCPS”) and 9,49,376 warrants of the Company on
to be held at Corporate Office
private placement and preferential basis (collectively
of the Company
referred to as “Issue”)
4. Extra-Ordinary General Date: January 12, 2024 To amendment of Articles of Association of the
Meeting Company to incorporate the terms of amended and
Place: Meeting conducted
restated shareholders’ agreement dated December 6,
through VC / OAVM pursuant
2023.
to the MCA Circulars deemed
to be held at Corporate Office
of the Company

(D) DETAILS OF NON-COMPLIANCE WITH REQUIREMENTS OF COMPANIES ACT, 2013

The Company is in compliance with the requirements of Companies Act, 2013, including with respect to compliance with
accounting and secretarial standards.

(E) DETAILS OF PENALTIES AND STRICTURES

No penalties or stricture imposed on the Company by the Reserve Bank of India and or any other statutory authority or
regulator.

(F) BREACH OF COVENANT

There was no breach of covenants of loans availed or debt securities issued by the Company as on March 31, 2024.

Aye Finance Private Limited 71

CORPORATE GOVERNANCE REPORT (CONTD.)

(G) DIVERGENCE IN ASSET CLASSFICATION AND PROVISIONING

Please refer notes to financial statements.

For and on behalf of the Board of Directors of

Aye Finance Private Limited

Sd/- Sd/-
Govinda Rajulu Chintala Sanjay Sharma
Chairperson & Independent Director Managing Director
DIN: 03622371 DIN: 03337545
Date: September 19, 2024 Place: Hyderabad Place: Gurugram

72 Annual Report 2023-24

 Financial Statements

INDEPENDENT AUDITOR’S REPORT

TO THE MEMBERS OF AYE FINANCE PRIVATE LIMITED the Companies Act, 2013. Our responsibilities under
those Standards are further described in the Auditor’s
Report on the Audit of the Financial Statements
Responsibilities for the Audit of the Financial Statements
OPINION section of our report. We are independent of the Company
We have audited the accompanying financial statements in accordance with the Code of Ethics issued by the
of AYE FINANCE PRIVATE LIMITED (“the Company”), Institute of Chartered Accountants of India together
which comprise the Balance sheet as at 31st March 2024, with the ethical requirements that are relevant to our
and the statement of Profit and Loss (including Other audit of the financial statements under the provisions
Comprehensive Income), statement of changes in equity of the Companies Act, 2013 and the Rules thereunder,
and statement of cash flows for the year then ended, and and we have fulfilled our other ethical responsibilities
notes to the financial statements, including a summary in accordance with these requirements and the Code
of material accounting policies and other explanatory of Ethics. We believe that the audit evidence we have
information. (hereinafter referred to as “the financial obtained is sufficient and appropriate to provide a basis
statements”). for our opinion on the financial statement.

In our opinion and to the best of our information and KEY AUDIT MATTERS
according to the explanations given to us, the aforesaid
Key audit matters are those matters that, in our
financial statements give the information required by the
professional judgment, were of most significance in our
Companies Act, 2013 in the manner so required and give a
audit of the financial statements of the current period.
true and fair view in conformity with the Indian Accounting
These matters were addressed in the context of our audit
Standards prescribed under section 133 of the Act read
of the financial statements as a whole, and in forming our
with the Companies (Indian Accounting Standards)
opinion thereon, and we do not provide a separate opinion
Rules, 2015, as amended, (“Ind AS”) and other accounting
on these matters.
principles generally accepted in India, of the state of affairs
of the Company as at March 31, 2024, its profit (including We have determined the matters described below to be the
other comprehensive income), changes in equity and its key audit matters to be communicated in our report. The
cash flows for the year ended on that date. results of our audit procedures, including the procedures
performed to address the matters below, provide the
BASIS FOR OPINION basis for our audit opinion on the accompanying financial
We conducted our audit in accordance with the Standards statements.
on Auditing (SAs) specified under section 143(10) of

Sr. Key Audit Matters Auditor’s Response

No.

Allowance for Expected Credit Losses (ECL) in respect of Principal Audit Procedures
loan assets.
Our audit focused on assessing the appropriateness
[Refer Note No. 2.14 for the accounting policy and Note No. of management’s judgment and estimates used in the
49 for the related disclosures] impairment analysis through the following procedures:

As at March 31, 2024, the Company has financial assets • Walkthrough and Control Assessment: Conducted
(loans) amounting to Rs. 4,133.40 Crores. As per Ind AS a walkthrough of the impairment loss allowance
109 - Financial Instruments, the Company is required to process, assessing the design effectiveness of
recognize loss allowance for expected credit losses (ECL) controls.
on financial assets.
• Policy and Compliance Review: Evaluated the
Company’s accounting policies for impairment of
financial assets for compliance with Ind AS 109
and the Board-approved governance framework
per RBI guidelines.

Aye Finance Private Limited 73

INDEPENDENT AUDITOR’S REPORT (CONTD.)

Sr. Key Audit Matters Auditor’s Response

No.

ECL is measured at 12-month ECL for Stage 1 loan assets • Model Understanding and Key Inputs: Gained
and at lifetime ECL for Stage 2 and Stage 3 loan assets. an understanding of the Company’s model for
Significant management judgment and assumptions calculating expected credit losses, including key
involved in measuring ECL is required with respect to: inputs, assumptions, and management overlays,
assessing the appropriateness and accuracy of
• determining the criteria for a significant increase in
data used.
credit risk (SICR)
• Analytical Procedures: Performed analytical
• factoring in future economic assumptions
reviews of disaggregated data to observe any
• techniques used to determine probability of default unusual trends warranting additional audit
(PD) , loss given default (LGD) and exposure at default procedures.
(EAD).
• 
Credit Risk Assessment: Evaluated the
ECL involves an estimation of probability weighted loss on Company’s determination of significant increase
financial instruments over their life, considering reasonable in credit risk, checked compliance with Ind AS
and supportable information about past events, current 109, and assessed historical data relevance in
conditions, and forecast of future economic conditions light of recent impairment losses. Tested loan
which could impact the credit quality of the Company’s staging criteria and indicators for loss.
loans and advances. In view of such high degree of
• 
Controls and Calculation Testing: Tested the
Management’s judgement involved in estimation of ECL, it
design and operating effectiveness of key
is a key audit matter.
controls, accuracy of inputs, and reasonableness
of assumptions used in ECL calculations.
Verified arithmetic calculations and assessed
presentation and disclosures.

INFORMATIONOTHERTHANTHEFINANCIALSTATEMENTS RESPONSIBILITY OF MANAGEMENT FOR THE FINANCIAL

AND AUDITOR’S REPORT THEREON STATEMENTS
The Company’s Board of Directors is responsible for the The Company’s Board of Directors is responsible for the
preparation of the other information. The other information matters stated in section 134(5) of the Companies Act,
comprises the information included in the Board’s Report 2013 (“the Act”) with respect to the preparation of these
but does not include the financial statements and our financial statements that give a true and fair view of the
auditor’s report thereon. The Company’s Board Report is financial position, financial performance including other
expected to be made available to us after the date of this comprehensive income, changes in equity and cash
auditor’s report. flows of the Company in accordance with the accounting
Our opinion on financial statements does not cover the principles generally accepted in India, including the Indian
other information and we do not express any form of accounting Standards (Ind AS) specified under section 133
assurance conclusion thereon. of the Act. This responsibility also includes maintenance
of adequate accounting records in accordance with the
In connection with our audit of the Financial Statements,
provisions of the Act for safeguarding of the assets of the
our responsibility is to read the other information identified
Company and for preventing and detecting frauds and
above when it becomes available and, in doing so, consider
other irregularities; selection and application of appropriate
whether the other information is materially inconsistent
accounting policies; making judgments and estimates that
with the financial statements, or our knowledge obtained in
are reasonable and prudent; and design, implementation
the audit or otherwise appears to be materially misstated.
and maintenance of adequate internal financial controls,
When we read the Company’s Board Report, if we conclude that were operating effectively for ensuring the accuracy
that there is a material misstatement therein, we are and completeness of the accounting records, relevant to
required to communicate the matter to those charged with the preparation and presentation of the financial statement
governance and take necessary actions, as applicable that give a true and fair view and are free from material
under the relevant laws and regulations. misstatement, whether due to fraud or error.

74 Annual Report 2023-24

 Financial Statements

INDEPENDENT AUDITOR’S REPORT (CONTD.)

In preparing the financial statements, management • Conclude on the appropriateness of management’s

is responsible for assessing the Company’s ability to use of the going concern basis of accounting and,
continue as a going concern, disclosing, as applicable, based on the audit evidence obtained, whether a
matters related to going concern and using the going material uncertainty exists related to events or
concern basis of accounting unless management either conditions that may cast significant doubt on the
intends to liquidate the Company or to cease operations, Company’s ability to continue as a going concern.
or has no realistic alternative but to do so. If we conclude that a material uncertainty exists, we
are required to draw attention in our auditor’s report
The Board of Directors are also responsible for overseeing
to the related disclosures in the Financial Statements
the company’s financial reporting process.
or, if such disclosures are inadequate, to modify our
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE opinion. Our conclusions are based on the audit
FINANCIAL STATEMENTS evidence obtained up to the date of our auditor’s
report. However, future events or conditions may
Our objectives are to obtain reasonable assurance about cause the Company to cease to continue as a going
whether the Financial Statements as a whole are free from concern.
material misstatement, whether due to fraud or error, and
to issue an auditor’s report that includes our opinion. • Evaluate the overall presentation, structure and
Reasonable assurance is a high level of assurance, but content of the Financial Statements, including the
is not a guarantee that an audit conducted in accordance disclosures, and whether the Financial Statements
with SAs will always detect a material misstatement when represent the underlying transactions and events in
it exists. Misstatements can arise from fraud or error and a manner that achieves fair presentation.
are considered material if, individually or in the aggregate, Materiality is the magnitude of misstatements in the
they could reasonably be expected to influence the Financial Statements that, individually or in aggregate,
economic decisions of users taken on the basis of these makes it probable that the economic decisions of
Financial Statements. a reasonably knowledgeable user of the Financial
As part of an audit in accordance with SAs, we exercise Statements may be influenced. We consider quantitative
professional judgment and maintain professional materiality and qualitative factors in (i) planning the
scepticism throughout the audit. We also: scope of our audit work and in evaluating the results of
our work; and (ii) to evaluate the effect of any identified
• Identify and assess the risks of material misstatement misstatements in the Financial Statements.
of the Financial Statements, whether due to fraud
or error, design and perform audit procedures We communicate with those charged with governance
responsive to those risks, and obtain audit evidence regarding, among other matters, the planned scope and
that is sufficient and appropriate to provide a basis timing of the audit and significant audit findings, including
for our opinion. The risk of not detecting a material any significant deficiencies in internal control that we
misstatement resulting from fraud is higher than for identify during our audit.
one resulting from error, as fraud may involve collusion, We also provide those charged with governance with
forgery, intentional omissions, misrepresentations, or a statement that we have complied with relevant
the override of internal control. ethical requirements regarding independence, and to
• Obtain an understanding of internal control relevant communicate with them all relationships and other
to the audit in order to design audit procedures that matters that may reasonably be thought to bear on our
are appropriate in the circumstances. Under section independence, and where applicable, related safeguards.
143(3)(i) of the Companies Act, 2013, we are also
REPORT ON OTHER LEGAL AND REGULATORY
responsible for expressing our opinion on whether
REQUIREMENTS
the company has adequate internal financial controls
system in place and the operating effectiveness of 1. 
As required by the Companies (Auditor’s Report)
such controls. Order, 2020 (the “Order”) issued by the Central
Government in terms of Section 143 (11) of the Act,
• Evaluate the appropriateness of accounting policies
we give in “Annexure A” a statement on the matters
used and the reasonableness of accounting estimates
specified in paragraphs 3 and 4 of the Order.
and related disclosures made by management.

Aye Finance Private Limited 75

INDEPENDENT AUDITOR’S REPORT (CONTD.)

2. As required by Section 143(3) of the Act, we report i) With respect to the other matters to be included
that:- in the Auditor’s Report in accordance with
Rule 11 of the Companies (Audit and Auditors)
a) We have sought and obtained all the information
Rules, 2014, in our opinion and to the best of our
and explanations which to the best of our
information and according to the explanations
knowledge and belief were necessary for the
given to us:-
purposes of our audit.
i. the Company has disclosed the impact of
b) In our opinion, proper books of account as
pending litigations on its financial position
required by law have been kept by the Company
in its Financial Statements. Refer Note 33 to
so far as it appears from our examination of those
the Financial Statements.
books except for the matter stated in paragraph
2(i)(vi) below on reporting under Rule 11(g) of the ii. 
The Company has made provision, as
Companies (Audit and Auditors) Rules, 2014 (as required under the applicable law or Ind AS,
amended). for material foreseeable losses, if any, on
long-term contracts including derivative
c) The Balance Sheet, the Statement of Profit and
contracts. – Refer Note 41 to the financial
Loss including Other Comprehensive Income,
statements.
Statement of Changes in Equity and the
Statement of Cash Flow dealt with by this Report iii. there were no amounts which were required
are in agreement with the books of account. to be transferred, to the Investor Education
and Protection Fund by the Company during
d) In our opinion, the aforesaid Financial Statements
the year ended 31st March 2024.
comply with the Indian Accounting Standards
specified under Section 133 of the Act, read with iv. a. 
The Management has represented
Rule 7 of the Companies (Accounts) Rules, 2014. that, to the best of its knowledge and
belief, no funds (which are material
e) On the basis of the written representations
either individually or in the aggregate)
received from the directors as on 31st March,2024
have been advanced or loaned or
taken on record by the Board of Directors, none
invested (either from borrowed funds
of the directors is disqualified as on 31st March,
or share premium or any other sources
2024 from being appointed as a director in terms
or kind of funds) by the Company to or
of Section 164 (2) of the Act.
in any other person or entity, including
f) With respect to the maintenance of accounts and foreign entity (“Intermediaries”), with
other matters connected therewith, reference is the understanding, whether recorded
made to our remarks in paragraph 2(i)(vi) below in writing or otherwise, that the
on reporting under Rule 11(g) of the Rules. Intermediary shall, whether, directly
g) 
With respect to the adequacy of the internal or indirectly lend or invest in other
financial controls with reference to Financial persons or entities identified in any
Statements of the Company and the operating manner whatsoever by or on behalf of
effectiveness of such controls, refer to our the Company (“Ultimate Beneficiaries”)
separate Report in “Annexure B”. or provide any guarantee, security
or the like on behalf of the Ultimate
h) With respect to the other matters to be included Beneficiaries;
in the Auditor’s Report in accordance with the
requirements of section 197(16) of the Act, as b. 
The Management has represented,
amended :- that, to the best of its knowledge and
belief, no funds (which are material
The Company is a private limited company and hence either individually or in the aggregate)
the provisions of section 197 of the Companies Act, have been received by the Company
2013 is not applicable to the Company. Accordingly, from any person or entity, including
reporting under section 197(16) of the Act is not foreign entity (“Funding Parties”), with
applicable to the Company. the understanding, whether recorded in

76 Annual Report 2023-24

 Financial Statements

INDEPENDENT AUDITOR’S REPORT (CONTD.)

writing or otherwise, that the Company database level for the accounting software
shall, whether, directly or indirectly, lend were not enabled and certain parameters
or invest in other persons or entities of audit trail were not captured for loan
identified in any manner whatsoever management software.
by or on behalf of the Funding Party
Further, during the course of our audit we
(“Ultimate Beneficiaries”) or provide
did not come across any instance of audit
any guarantee, security or the like on
trail feature being tampered with, wherein
behalf of the Ultimate Beneficiaries;
the audit trail functionality was enabled
c. 
Based on the audit procedures that
As proviso to Rule 3(1) of the Companies
have been considered reasonable
(Accounts) Rules, 2014 is applicable
and appropriate in the circumstances,
from April 1, 2023, thus reporting under
nothing has come to our notice that
Rule 11(g) of the Companies (Audit and
has caused us to believe that the
Auditors) Rules, 2014 on preservation of
representations under sub-clause
audit trail as per the statutory requirements
(i) and (ii) of Rule 11(e), as provided
for record retention is not applicable for the
under (a) and (b) above, contain any
financial year ended March 31, 2024.
material misstatement.

v. 
the company has not declared or paid
any dividend during the year ended March For S S Kothari Mehta & Co. LLP
31,2024. Chartered Accountants
Firm’s Registration No. 000756N/N500441
vi. Based on our examination which
included test checks, the Company has Vijay Kumar
used accounting software and loan Partner
management software for maintaining Membership No. 092671
its books of account which has feature of
recording audit trail (edit log) facility and Place: New Delhi
the same has operated throughout the Date: May 24, 2024
year for all relevant transactions recorded
in the software, except that audit logs at UDIN: 24092671BKFBOU9491

Aye Finance Private Limited 77

ANNEXURE “A”
TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements’ section of our report to the Members
of AYE FINANCE PRIVATE LIMITED of even date)

To the best of our information and according to the (Prohibition) Act, 1988 (as amended in 2016) and
explanations provided to us by the Company and the books rules made thereunder.
of account and records examined by us in the normal
ii. (a) The Company does not have any inventory and
course of audit, we state that:
hence reporting under clause 3(ii)(a) of the Order
i. In respect of the Company’s Property, Plant and is not applicable.
Equipment and Intangible Assets:
(b) As disclosed in note 55(f) to the financial
a. (A) 
The Company has maintained proper statements, the Company has been sanctioned
records showing full particulars, including working capital limits in excess of rupees five
quantitative details and situation of Crores in aggregate from banks and financial
Property, Plant and Equipment and relevant institutions during the year on the basis of security
details of right-of-use assets. of current assets of the Company. Based on the
records examined by us in the normal course of
(B) 
The Company has maintained proper
audit of the financial statements, the quarterly
records showing full particulars of intangible
returns/ statements filed by the Company with
assets.
such banks are in agreement with the unaudited
b. The Property, Plant & Equipment have been books of accounts of the Company.
physically verified by the management during
iii. (a) Since, the Company’s Principal business is to
the year and no material discrepancies were
give loans and accordingly, the requirement
identified on such verification.
to report on clause 3(iii)(a) of the Order is not
c. Based on the information and explanation given applicable as the Company.
to us, the Company does not have any immovable
(b) In our opinion, the investments made and the
property, hence reporting under clause 3(i) (c) of
terms and conditions of the grant of all loans
the order is not applicable.
provided, during the year are, prima facie, not
d. According to the information and explanation prejudicial to the Company’s interest. Company
given to us and based on our examination of has not provided any guarantee or security to
records, the Company has not revalued any of its companies, firms, Limited Liability Partnerships
Property, Plant and Equipment (including right- or any other parties.
of-use assets) and intangible assets during the
(c) In respect of loans granted by the Company, the
year.
schedule of repayment of principal and payment of
e. According to the information and explanation interest has been stipulated and the repayments
given to us and based on our examination of of principal amounts and receipts of interest
records, no proceedings have been initiated are generally been regular as per stipulation.
during the year or are pending against the Since, the Company is NBFC and considering the
Company as at March 31, 2024 for holding any significant volume of transactions with number
Benami property under the Benami Transactions of borrowers furnishing the number of cases of
default is practically not feasible.

(d) In respect of loans granted by the Company, the details of total amount overdue above 90 days are as follows:-

(Amount in Rs. in Crores)

Type of Loan Nos of Cases Principal Overdue Interest Overdue Total Overdue
Hypothecation Loan & Switchpe loan 19,199 51.34 16.38 67.72
Mortgage Loan 52 0.22 0.2 0.42
Quasi-Mortgage Loan 1,014 2.13 0.86 2.99
Total 20,265 53.69 17.44 71.13

78 Annual Report 2023-24

 Financial Statements

“ANNEXURE A” (CONTD.)

Based on the information & explanations given vi. 

The maintenance of cost records has not been
to us, reasonable steps have been taken by the specified by the Central Government under sub-
Company for the recovery of the Principal & section (1) of section 148 of the Companies Act,
Interest. 2013 for the business activities carried out by the
Company. Hence, reporting under clause 3(vi) of the
(e) Reporting under clause 3(iii)(e) of the Order is
Order is not applicable to the Company.
not applicable as the Company is a Non-Banking
Financial Company whose principal business is vii. In respect of statutory dues:
to give loans.
a. In our opinion, the Company has generally been
(f) 
The Company has not granted any loans or regular in depositing undisputed statutory dues,
advances in the nature of loans either repayable including Goods and Services tax, Provident
on demand or without specifying any terms or Fund, Employees’ State Insurance, Income Tax,
period of repayment during the year. Hence the Sales Tax, Service Tax, duty of Custom, duty
reporting under clause 3(iii)(f) is not applicable. of Excise, Value Added Tax, Cess and other
material statutory dues applicable to it with the
iv. According to the information and explanations given
appropriate authorities.
to us, there are no transactions which are required to
be reported under Section 185 of the Act, accordingly, There were no undisputed amounts payable
provisions of section 185 of the Act are not applicable in respect of Goods and Service tax, Provident
to the Company. However, the Company has complied Fund, Employees’ State Insurance, Income Tax,
with the provisions of section 186 of the Act in respect Sales Tax, Service Tax, duty of Custom, duty
of investments made. of Excise, Value Added Tax, Cess and other
material statutory dues in arrears as at March
v. 
The Company has not accepted any deposit or
31, 2024 for a period of more than six months
amounts which are deemed to be deposits. Hence,
from the date they became payable except
reporting under clause 3(v) of the Order is not
Provident fund amount of Rs. 0.12 Crores and
applicable.
Labour Welfare Fund amount of Rs. 0.04 Crores.

b. Details of statutory dues referred to in sub-clause (a) above which have not been deposited as on March 31, 2024
on account of disputes are given below:-

Name of the Nature of Forum where Period to which the Amount under dispute Amount Paid
statute Dues Dispute is Pending Amount Relates (Rs.in crores) (Rs.in crores)**

The Income Income Tax Commissioner AY 2017-18 2.44 0.48

Tax Act, 1961 Demands of Income Tax
(Appeals)

*AY=Assessment Year
** paid under protest

viii. 
There were no transactions relating to previously (b) Based on the information and explanations
unrecorded income that have been surrendered obtained by us, the Company has not been
or disclosed as income during the year in the tax declared wilful defaulter by any bank or financial
assessments under the Income Tax Act, 1961 institution or government or any government
(43 of 1961). authority.

ix. (a) According to the information and explanation (c) Money raised during the year by the Company
given to us and based on our examination of by way of term loans has been applied for the
records, the Company has not defaulted in purpose for which they were raised other than
repayment of loans or other borrowings or in temporary deployment pending application of
the payment of Interest thereon to any lender proceeds.
and hence, reporting under clause 3(ix)(a) of the
Order is not applicable.

Aye Finance Private Limited 79

“ANNEXURE A” (CONTD.)

(d) According to the information and explanation Company has terminated the services of such
given to us and based on our overall examination employees and also initiated legal action against
of records, funds raised on short- term basis them, wherever necessary.
have, prima facie, not been used during the year
(b) According to the information and explanation
for long-term purposes by the Company.
given to us and based on our examination of
(e) According to the information and explanation records, no report under sub-section (12) of
given to us and based on our examination of section 143 of the Companies Act has been filed
records, the Company has not taken any funds in Form ADT-4 as prescribed under rule 13 of
from any entity or person on account of or to Companies (Audit and Auditors) Rules, 2014 with
meet the obligations of its subsidiary. Further, the Central Government, during the year and upto
the company does not have any associate or the date of this report.
joint venture.
(c) As represented to us by the management, there
(f) According to the information and explanation are no whistle-blower complaints received by the
given to us and based on our examination of company during the year.
records, the Company has not raised loans on
xii. The Company is not a Nidhi Company and hence
the pledge of securities held in its subsidiary
reporting under clause 3(xii) of the Order is not
company during the year. Further, the company
applicable.
does not have any associate or joint venture.
Hence, reporting under clause 3(ix)(f) of the xiii. In our opinion, the Company is in compliance with
Order is not applicable. Section 177 and 188 of the Companies Act, 2013 with
respect to applicable transactions with the related
x. (a) The Company has not raised moneys by way
parties and the details of related party transactions
of initial public offer or further public offer
have been disclosed in the financial statements as
(including debt instruments) during the year and
required by the applicable Ind AS.
hence reporting under clause 3(x)(a) of the Order
is not applicable. xiv. (a) According to the information and explanation
given to us and based on our examination of
(b) According to the information and explanation
records, in our opinion the Company has an
given to us and based on our examination of
adequate internal audit system commensurate
records, during the year, The Company has
with the size and the nature of its business.
made a private placement and preferential
allotment of compulsorily convertible preference (b) We have considered, the internal audit reports
shares and the preferential allotment of equity for the year under audit, issued to the Company
warrants during the year, in compliance with during the year and till date of our report, in
the requirements of Section 42 and Section 62 determining the nature, timing and extent of our
of the Act. The funds raised have been used audit procedures.
for the purpose for which funds were raised. xv. According to the information and explanations given
The Company has not made any preferential to us and based on our examination of the records
allotment or private placement of convertible of the Company, the Company has not entered into
debentures (fully or partly or optionally) during non-cash transactions with directors or persons
the year. connected with him. Accordingly, paragraph 3(xv) of
xi. (a) According to the information and explanation the Order is not applicable.
given to us and based on our examination of xvi. (a) The Company has registered as required, under
records, no fraud by the Company or on the Section 45-IA of the Reserve Bank of India Act,
Company has been noticed or reported during the 1934.
period covered by our audit except management
reported few instances of embezzlement of cash (b) 
The Company has not conducted any Non-
by staff, involving amount aggregating to Rs. Banking Financial or Housing Finance activities
0.42 Crores as mentioned in Note No. 53.18 to without a valid Certificate of Registration (CoR)
the financial statements. As informed to us, the from the Reserve Bank of India as per the Reserve
Bank of India Act, 1934.

80 Annual Report 2023-24

 Financial Statements

“ANNEXURE A” (CONTD.)

(c) According to the information and explanations meeting its liabilities existing at the date of balance
given to us and based on our examination of the sheet as and when they fall due within a period of one
records, the Company is not a Core Investment year from the balance sheet date. We, however, state
Company (CIC) as defined in the regulations that this is not an assurance as to the future viability
made by the Reserve Bank of India, accordingly, of the Company. We further state that our reporting is
paragraph 3(xvi)(c) of the Order is not applicable. based on the facts up to the date of the audit report
and we neither give any guarantee nor any assurance
(d) According to the information and explanations
that all liabilities falling due within a period of one
given to us and based on our examination
year from the balance sheet date, will get discharged
of the records, there is no core investment
by the Company as and when they fall due.
company within the Group (as defined in the
Core Investment Companies (Reserve Bank) xx. (a) In respect of other than ongoing projects, there
Directions, 2016). are no unspent amounts towards Corporate
Social Responsibility (CSR) requiring a transfer
xvii. The Company has not incurred cash losses during
to a Fund specified in Schedule VII to the
the financial year covered by our audit and the
Companies Act in compliance with second
immediately preceding financial year.
proviso to sub-section (5) of Section 135 of the
xviii. In terms of RBI Circular RBI/2021-22/25 dated said Act. Accordingly, reporting under clause
April 27, 2021, w.r.t. Guidelines for Appointment of 3(xx)(a) of the Order is not applicable for the
Statutory Central Auditors (SCAs)/Statutory Auditors year.
(SAs) of Commercial Banks (excluding RRBs), UCBs
(b) As per information and explanations given to
and NBFCs (including HFCs), the previous statutory
us, there are no ongoing projects with respect to
auditors of the Company had resigned during the
CSR. Accordingly, reporting under clause 3(xx)
period under audit. We have obtained no objection
(b) of the Order is not applicable for the year.
from the previous statutory auditors and no issues
have been informed to us.
For S S Kothari Mehta & Co. LLP
xix. On the basis of the financial ratios, ageing and Chartered Accountants
expected dates of realisation of financial assets and Firm’s Registration No. 000756N/N500441
payment of financial liabilities, other information
accompanying the financial statements and our Vijay Kumar
knowledge of the Board of Directors and Management Partner
plans and based on our examination of the evidence Membership No. 092671
supporting the assumptions, nothing has come to
our attention, which causes us to believe that any Place: New Delhi
material uncertainty exists as on the date of the audit Date: May, 24 2024
report indicating that Company is not capable of
UDIN: 24092671BKFBOU9491

Aye Finance Private Limited 81

“ANNEXURE B”
TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE FINANCIAL STATEMENTS OF AYE FINANCE PRIVATE
LIMITED.

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013
(“the Act”) as referred to in paragraph 2(f) of ‘Report on Other Legal and Regulatory Requirements’ of our Independent
Auditor’s Report

We have audited the internal financial controls with and their operating effectiveness. Our audit of internal
reference to Financial Statements of Aye Finance financial controls with reference to financial statements
Private Limited (“the Company”) as of March 31, 2024 in included obtaining an understanding of internal financial
conjunction with our audit of the Financial Statements of controls with reference to financial statements, assessing
the Company for the year ended on that date. the risk that a material weakness exists, and testing and
evaluating the design and operating effectiveness of
MANAGEMENT’S RESPONSIBILITY FOR INTERNAL internal control based on the assessed risk. The procedures
FINANCIAL CONTROLS selected depend on the auditor’s judgement, including the
The Company’s management is responsible for assessment of the risks of material misstatement of the
establishing and maintaining internal financial controls financial statements, whether due to fraud or error.
based on the internal control over Financial Reporting We believe that the audit evidence we have obtained is
criteria established by the Company considering the sufficient and appropriate to provide a basis for our audit
essential components of internal control stated in the opinion on the Company’s internal financial controls
Guidance Note on Audit of Internal Financial Controls over system with reference to financial statements.
Financial Reporting issued by the Institute of Chartered
Accountants of India. These responsibilities include the MEANING OF INTERNAL FINANCIAL CONTROLS WITH
design, implementation and maintenance of adequate REFERENCE TO FINANCIAL STATEMENTS
internal financial controls that were operating effectively
A company’s internal financial control with reference to
for ensuring the orderly and efficient conduct of its
financial statements is a process designed to provide
business, including adherence to company’s policies, the
reasonable assurance regarding the reliability of financial
safeguarding of its assets, the prevention and detection of
reporting and the preparation of financial statements
frauds and errors, the accuracy and completeness of the
for external purposes in accordance with generally
accounting records, and the timely preparation of reliable
accepted accounting principles. A company’s internal
financial information, as required under the Companies
financial control with reference to financial statements
Act, 2013.
includes those policies and procedures that (1) pertain
to the maintenance of records that, in reasonable
AUDITORS’ RESPONSIBILITY
detail, accurately and fairly reflect the transactions and
Our responsibility is to express an opinion on the dispositions of the assets of the company; (2) provide
Company’s internal financial controls with reference to reasonable assurance that transactions are recorded as
Financial Statements based on our audit. We conducted necessary to permit preparation of financial statements in
our audit in accordance with the Guidance Note on Audit accordance with generally accepted accounting principles,
of Internal Financial Controls Over Financial Reporting and that receipts and expenditures of the company are
(the “Guidance Note”) issued by the Institute of Chartered being made only in accordance with authorisations of
Accountants of India and the Standards on Auditing, management and directors of the company; and (3)
prescribed under section 143(10) of the Companies Act, provide reasonable assurance regarding prevention or
2013, to the extent applicable to an audit of internal timely detection of unauthorised acquisition, use, or
financial controls. Those Standards and the Guidance disposition of the company’s assets that could have a
Note require that we comply with ethical requirements and material effect on the financial statements.
plan and perform the audit to obtain reasonable assurance
about whether adequate internal financial controls with INHERENT LIMITATIONS OF INTERNAL FINANCIAL
reference to financial statements was established and CONTROLS WITH REFERENCE TO FINANCIAL
maintained and if such controls operated effectively in all STATEMENTS
material respects.
Because of the inherent limitations of internal financial
Our audit involves performing procedures to obtain audit controls with reference to financial statements, including
evidence about the adequacy of the internal financial the possibility of collusion or improper management
controls system with reference to financial statements override of controls, material misstatements due to error

82 Annual Report 2023-24

 Financial Statements

“ANNEXURE B” (CONTD.)

or fraud may occur and not be detected. Also, projections considering the essential components of internal control
of any evaluation of the internal financial controls with stated in the Guidance Note on Audit of Internal Financial
reference to financial statements to future periods are Controls Over Financial Reporting issued by the Institute of
subject to the risk that the internal financial control with Chartered Accountants of India.
reference to financial statements may become inadequate
because of changes in conditions, or that the degree of For S S Kothari Mehta & Co. LLP
compliance with the policies or procedures may deteriorate. Chartered Accountants
Firm Reg. No. :- 000756N/N500441
OPINION

In our opinion, based on the records, the Company has, Vijay Kumar
in all material respects, an adequate internal financial Partner
controls system with reference to financial statements Membership No. 092671
and such internal financial controls with reference to
Place: New Delhi
financial statements were operating effectively as at March
Date: May 24, 2024
31, 2024, based on the internal control with reference to
financial statements criteria established by the Company UDIN: 24092671BKFBOU9491

Aye Finance Private Limited 83

BALANCE SHEET
as at March 31, 2024
(All amounts are in ` crore unless otherwise stated)

Particulars Notes As at As at
March 31, 2024 March 31, 2023
ASSETS
Financial assets
Cash and cash equivalents 3 526.59 272.63
Bank balances other than cash and cash equivalents 4 203.67 121.42
Derivative financial instruments 12 - 3.07
Loans 5 4,003.12 2,555.44
Investments 6 10.61 84.46
Other financial assets 7 30.66 22.81
Total financial assets 4,774.65 3,059.83

Non-financial assets
Current tax assets (net) 8 11.73 18.08
Deferred tax assets (net) 9 43.94 29.34
Property, plant and equipment 10A 8.96 5.46
Right of use assets 10B 21.43 21.15
Intangible assets under development 37 2.95 0.47
Intangible assets 10C 1.32 0.55
Other non-financial assets 11 8.07 5.13
Total non-financial assets 98.40 80.18
Total assets 4,873.05 3,140.01

LIABILITIES AND EQUITY

LIABILITIES
Financial liabilities
Derivative financial instruments 12 3.15 -
Debt securities 13 1,022.34 899.85
Borrowings (other than debt securities) 14 2,476.65 1,396.31
Lease liabilities 15 23.63 24.29
Other financial liabilities 16 55.42 16.07
Total financial liabilities 3,581.19 2,336.52

Non-financial liabilities
Provisions 17 30.29 22.67
Other non-financial liabilities 18 25.46 12.32
Total non-financial liabilities 55.75 34.99

EQUITY
Equity share capital 19 39.93 30.45
Other equity 20 1,196.18 738.05
Total equity 1,236.11 768.50
Total liabilities and equity 4,873.05 3,140.01
Summary of material accounting policies. 1 to 2
The accompanying notes are an integral part of the financial statements. 3 to 55

In terms of our report attached

For S S Kothari Mehta & Co. LLP For and on behalf of the Board of Directors of
Chartered Accountants Aye Finance Private Limited
Firm Registration No.: 000756N / N500441

per Vijay Kumar Sanjay Sharma Govinda Rajulu Chintala Krishan Gopal Tripti Pandey
Partner Managing Director Chairperson and Chief Financial Officer Company Secretary
Independent Director
Membership No: DIN: 03337545 DIN: 03622371 Membership No: 32760
092671
New Delhi Gurugram Virginia, USA Gurugram Gurugram
May 24, 2024 May 24, 2024 May 24, 2024 May 24, 2024 May 24, 2024

84 Annual Report 2023-24

 Financial Statements

STATEMENT OF PROFIT AND LOSS

for the year ended March 31, 2024
(All amounts are in ` crore unless otherwise stated)

Particulars Notes For the year ended For the year ended
March 31, 2024 March 31, 2023
Revenue from operations
Interest income 21 948.69 566.49
Fees and commission income 23 47.86 25.48
Net gain on derecognition of financial instruments under amortised 22 18.95 12.51
cost category
Net gain on fair value changes 24 24.72 18.95
Total revenue from operations 1,040.22 623.43

Other income 25 31.53 19.91

Total income 1,071.75 643.34

Expenses
Finance cost 26 326.53 197.96
Net loss on fair value changes 27 6.18 6.57
Impairment on financial instruments 28 131.40 73.35
Employee benefit expenses 29 275.21 212.20
Depreciation and amortisation expense 10 14.54 11.45
Other expenses 30 90.03 70.41
Total expenses 843.89 571.94

Profit before tax 227.86 71.40

Tax expense:
Current tax 81.18 0.62
Deferred tax -14.45 16.99
Income tax expense 66.73 17.61

Profit for the year (A) 161.13 53.79

Other comprehensive (loss) / income

Items that will not be reclassified subsequently to profit or loss
Re-measurement income on defined benefit plans -0.56 3.99
Income tax effect 0.15 -1
Other comprehensive (loss) / income (B) -0.41 2.99

Total comprehensive income for the year (A+B) 160.72 56.78

Earnings per share (equity share, par value of ` 10 each)

Basic (`) 32 49.84 17.34
Diluted (`) 32 49.29 17.13
Nominal value 10.00 10.00
Summary of material accounting policies 1 to 2
The accompanying notes are an integral part of the financial statements. 3 to 55
In terms of our report attached
For S S Kothari Mehta & Co. LLP For and on behalf of the Board of Directors of
Chartered Accountants Aye Finance Private Limited
Firm Registration No.: 000756N / N500441

per Vijay Kumar Sanjay Sharma Govinda Rajulu Chintala Krishan Gopal Tripti Pandey
Partner Managing Director Chairperson and Chief Financial Officer Company Secretary
Independent Director
Membership No: DIN: 03337545 DIN: 03622371 Membership No: 32760
092671
New Delhi Gurugram Virginia, USA Gurugram Gurugram
May 24, 2024 May 24, 2024 May 24, 2024 May 24, 2024 May 24, 2024

Aye Finance Private Limited 85

STATEMENT OF CASH FLOW
for the year ended March 31, 2024
(All amounts are in ` crore unless otherwise stated)

Particulars For the year ended For the year ended

March 31, 2024 March 31, 2023
Cash flow from operating activities
Profit / (Loss) before tax 227.86 71.40
Adjustments for:
Depreciation and impairment of PPE 5.09 4.13
Depreciation on right of use assets 9.45 7.32
Loss/ (Gain) on fair value of cross currency swap 6.22 -0.39
Unrealised (gain) / loss on investments in mutual fund 0 -0.14
Profit on sale of mutual fund units -21.01 -11.85
Impairment of financial instruments 76.80 20.85
Profit on Early Termination of lease -0.26 -
Provision on Investment 0.25 -
Loans and advances written off 55.31 50.00
Loss on settlement 1.68 2.50
Loss on sale of property, plant and equipment (net) 0.05 -
Expense on employee stock option scheme 4.70 5.70
Unrealised Interest income on security deposit -0.63 -
Interest Income on account of processing fees amortisation 17.86 -
Interest Expense on account of processing fees amortisation -7.75 -
Excess Interest Spread -0.31 -
Interest on leases liabilities 2.21 3.16
Operating profit before working capital changes 377.52 152.68
Movements in working capital:
(Increase)/Decrease in bank balances not considered as cash and cash -82.25 102.95
equivalents
(Increase) / Decrease in loan portfolio -1,599.33 -941.08
(Increase) / Decrease in other financial assets -7.97 -15.72
(Increase) / Decrease in other non financial assets -2.94 1.21
Increase / (Decrease) in other financial liabilities (excluding lease liabilities) 39.02 -16.71
Increase / (Decrease) in derivative financial instruments - -6.96
Increase / (Decrease) in other non financial liabilities 13.14 5.97
Increase / (Decrease) in provisions 7.06 6.51
Cash used in operations -1,255.75 -711.15
Income taxes paid -74.83 -8.87
Net cash used in operating activities (A) -1330.58 -720.02

Cash flow from investing activities

Purchase of property, plant and equipment, excluding right of use assets -9.60 -4.43
Sale of property, plant and equipment, excluding right of use assets 0.05 -
Purchase of investments -7,188.5 -3,743.81
Sale of investments 7,283.11 3,826.45
Intangible assets under development -2.01 -
Net cash used in investing activities (B) 83.05 78.21

86 Annual Report 2023-24

 Financial Statements

STATEMENT OF CASH FLOW (CONTD.)

for the year ended March 31, 2024
(All amounts are in ` crore unless otherwise stated)

Particulars For the year ended For the year ended

March 31, 2024 March 31, 2023
Cash flow from financing activities
Proceeds from issue of equity shares (including securities premium) 302.09 -
Amount received from issue of share warrants 0.09 -
Proceeds from issue of debt securities 678.70 492.65
Redemption of debt securities -556.21 -515.03
Proceeds from borrowings (other than debt securities) 2,839.50 1,267.72
Repayment of borrowings (other than debt securities) -1,713.41 -473.64
Payment of lease liabilities (including interest) -11.27 -10.11
Movement of loan repayable on demand -38.00 -
Net cash generated from financing activities (C) 1,501.49 761.59

Net increase / (decrease) in cash and cash equivalents (A + B + C) 253.96 119.79

Cash and cash equivalents at the beginning of the period 272.63 152.84
Cash and cash equivalents at the end of the year (refer note 3) 526.59 272.63

Components of cash and cash equivalents as at the end of the period

Cash in hand 9.20 4.93
Balance with banks - on current account 227.14 37.37
Deposits with original maturity of less than or equal to 3 months 290.25 230.33
Total cash and cash equivalents 526.59 272.63

Note:

The above cash flow statement has been prepared under the “Indirect Method” as set out in Indian Accounting Standard
(Ind AS) 7 - “Statement of Cash Flows”.

In terms of our report attached

For S S Kothari Mehta & Co. LLP For and on behalf of the Board of Directors of
Chartered Accountants Aye Finance Private Limited
Firm Registration No.: 000756N / N500441

per Vijay Kumar Sanjay Sharma Govinda Rajulu Chintala Krishan Gopal Tripti Pandey
Partner Managing Director Chairperson and Chief Financial Officer Company Secretary
Independent Director
Membership No: DIN: 03337545 DIN: 03622371 Membership No: 32760
092671
New Delhi Gurugram Virginia, USA Gurugram Gurugram
May 24, 2024 May 24, 2024 May 24, 2024 May 24, 2024 May 24, 2024

Aye Finance Private Limited 87

STATEMENT OF CHANGES IN EQUITY
for the year ended March 31, 2024
(All amounts are in ` crore unless otherwise stated)

A. EQUITY SHARE CAPITAL

Particulars As at March 31, 2024 As at March 31, 2023

No. of shares Amount No. of shares Amount
Balance at the beginning of the year 3,04,52,654 30.45 3,04,52,654 30.45
Changes in equity share capital during the year 47,39,244 9.48 - -
Balance at the end of the year 3,51,91,898 39.93 3,04,52,654 30.45

Equity share capital

Particulars As at March 31, 2024 As at March 31, 2023
Equity shares of ` 10 each issued, subscribed No. of shares Amount No. of shares Amount
and fully paid
Balance at the beginning of the reporting year 48,30,500 4.83 48,30,500 4.83
Changes in share capital due to prior period
- - - -
errors
Amount recoverable from ESOP Trust (face
value of 5,60,294 shares of ` 10 each held by - (0.56) (0.56)
trust)
Restated balance at the beginning of the
48,30,500 4.27 48,30,500 4.27
current/previous Reporting period
Changes in share capital during the year 20 - - -
Balance at the end of the reporting year 48,30,520 4.27 48,30,500 4.27

Compulsorily Convertible Cumulative Preference Shares (CCPS)

Particulars As at March 31, 2024 As at March 31, 2023

Preference shares of ` 10 each issued, No. of shares Amount No. of shares Amount
subscribed and fully paid
Balance at the beginning of the reporting year 2,61,82,448 26.18 2,61,82,448 26.18
Changes in share capital due to prior period
- - - -
errors
Restated balance at the beginning of the
2,61,82,448 26.18 2,61,82,448 26.18
current/previous Reporting period
Changes in share capital during the year - - - -
Balance at the end of the reporting year 2,61,82,448 26.18 2,61,82,448 26.18

Compulsorily Convertible Cumulative Preference Shares (CCPS)

Particulars As at March 31, 2024 As at March 31, 2023
Preference shares of ` 20 each issued, No. of shares Amount No. of shares Amount
subscribed and fully paid
Balance at the beginning of the reporting year - - - -
Changes in share capital due to prior period
- - - -
errors
Restated balance at the beginning of the
- - - -
current/previous Reporting period
Changes in share capital during the year 47,39,244 9.48 - -
Balance at the end of the reporting year 47,39,244 9.48 - -

88 Annual Report 2023-24

 Financial Statements

STATEMENT OF CHANGES IN EQUITY (CONTD.)

for the year ended March 31, 2024
(All amounts are in ` crore unless otherwise stated)

B. OTHER EQUITY

Particulars Reserves and surplus Total

Statutory Securities Share Retained Other Share
reserve under premium option earnings comprehensive warrants
section 45IC of outstanding income
RBI Act account
Balance at the end of the reporting
15.13 659.34 11.50 (10.93) 0.52 - 675.56
year 2022
Change in accounting policy or prior
- - - - - - -
period errors
Restated balance at the end of the
15.13 659.34 11.50 (10.93) 0.52 - 675.56
reporting year 2022
Profit for the year - - - 53.79 - - 53.79
Transfer to / (from) statutory reserve
11.00 - - (11.00) - - -
under 45IC of RBI Act 1934
Other comprehensive income for the year - - - - 2.99 - 2.99
Transfer to / from share option
- - 5.71 - - - 5.71
outstanding account
Utilisation / lapses of share option
- - - - - - -
outstanding
Balance at the end of the reporting
26.13 659.34 17.21 31.86 3.51 - 738.05
year 2023
Change in accounting policy or prior
- - - - - -
period errors
Restated balance at the end of the
26.13 659.34 17.21 31.86 3.51 - 738.05
reporting year 2023
Profit for the year - - - 161.13 - - 161.13
Transfer to / (from) statutory reserve
32.23 - - (32.23) - - -
under 45IC of RBI Act 1934
Other comprehensive income for the year - - - - (0.41) - (0.41)
Transfer to / from share option
- - 4.70 - - - 4.70
outstanding account
Utilisation / lapses of share option
- - - - - - -
outstanding
Premium on Issue of share capital - 292.61 - - - - 292.61
Money received against share warrants - - - - - 0.09 0.09
Balance at the end of the reporting
58.36 951.95 21.91 160.76 3.10 0.09 1,196.18
year 2024

In terms of our report attached

For S S Kothari Mehta & Co. LLP For and on behalf of the Board of Directors of
Chartered Accountants Aye Finance Private Limited
Firm Registration No.: 000756N / N500441

per Vijay Kumar Sanjay Sharma Govinda Rajulu Chintala Krishan Gopal Tripti Pandey
Partner Managing Director Chairperson and Chief Financial Officer Company Secretary
Independent Director
Membership No: DIN: 03337545 DIN: 03622371 Membership No: 32760
092671
New Delhi Gurugram Virginia, USA Gurugram Gurugram
May 24, 2024 May 24, 2024 May 24, 2024 May 24, 2024 May 24, 2024

Aye Finance Private Limited 89

NOTES FORMING PART OF THE FINANCIAL STATEMENTS
for the year ended March 31, 2024

1 GENERAL INFORMATION 2.2 Basis of preparation:

Aye Finance Private Limited (“AFPL” or “the Company”) The financial statements have been prepared on a
was incorporated to carry on the business of a finance going concern basis the historical cost basis except
company and to provide finance (whether short or long for certain financial instruments that are measured at
term loan or working capital finance, development fair values at the end of each reporting period.
finance, factoring, leasing, guarantees or any other
2.3 Presentation of financial statements:
debt related funding) to micro, small and medium
scale enterprises and to individuals. On July 18, 2014, The financial statements have been prepared in
the Company received a certificate of registration accordance with Indian Accounting Standards
from the Reserve Bank of India vide registration no. (Ind AS) as per the Companies (Indian Accounting
B-14.03323 under Section 45-IA of the Reserve Standards) Rules, 2015 as amended from time to time
Bank of India Act, 1934 to carry on the business of and notified under section 133 of the Companies Act,
a Non-Banking Financial Company (NBFC) without 2013 (the Act) along with other relevant provisions
acceptance of public deposits. The Company is of the Act and the Master Direction – Non-Banking
currently a systemically important non deposit taking Financial Company – Systemically Important Non-
Non Banking Finance Company (ND-NBFC) as defined Deposit taking Company and Deposit taking Company
under Section 45 – IA of the Reserve Bank Of India (Reserve Bank) Directions, 2020 , as amended (‘the
Act, 1934. Accordingly, all provisions of the Reserve NBFC Master Directions’) issued by RBI. The financial
Bank of India Act, 1934 and all directions, guidelines statements have been prepared on a going concern
or instructions of the Reserve Bank of India that have basis.
been issued from time to time and are in force and 
The Company uses accrual basis of accounting
as applicable to a Non deposit taking Non-Banking except in case of significant uncertainties. The
Financial Company are applicable to the Company. financial statements are presented in Indian Rupees
The registered office of the Company is situated in (INR) and all values are rounded to the crore, except
Delhi. when otherwise indicated. The regulatory disclosures
The Company has issued debentures on a private as required by RBI Master Directions to be included as
placement basis and the said securities are listed a part of the Notes to Accounts are also prepared as
with Bombay Stock Exchange (BSE) on Debt market per the Ind AS financial statements.
segment. The Company presents its balance sheet in order of
liquidity. Financial assets and financial liabilities are
2 MATERIAL ACCOUNTING POLICIES: generally reported gross in the balance sheet. They are
only offset and reported net when, in addition to having
2.1 Statement of compliance:
an unconditional legally enforceable right to offset the
The financial statements have been prepared in recognised amounts without being contingent on a
accordance with the provisions of the Companies future event, the parties also intend to settle on a net
Act, 2013 and the Indian Accounting Standards (Ind basis in all of the following circumstances:
AS) notified under the Companies (Indian Accounting
Standards) Rules, 2015 (as amended from time to time) (a) The normal course of business
issued by Ministry of Corporate Affairs in exercise of (b) The event of default
the powers conferred by section 133 of Companies
Act, 2013, (the ‘Act’), other relevant provisions of the (c) 
The event of insolvency or bankruptcy of the
Act. In addition, the guidance notes/announcements Group and / or its counterparties
issued by the Institute of Chartered Accountants of 2.4 Revenue recognition:
India (ICAI) are also applied except where compliance
Revenue is recognised to the extent that it is probable
with other statutory promulgations require a different
that the economic benefits will flow to the Company
treatment. Any directions issued by the RBI or other
and the revenue can be reliably measured and there
regulators are implemented as and when they become
exists reasonable certainty of its recovery. Revenue
applicable.
is measured at the fair value of the consideration

90 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

received or receivable as reduced for estimated (c)  et gain / (loss) on de recognition of financial
N
customer credits and other similar allowances. instruments under amortised cost category

(a) Interest income 

Gains arising out of direct assignment
transactions comprise the difference between
EIR method
the interest on the loan portfolio and the
Under Ind AS 109, interest income is recorded applicable rate at which the direct assignment
using the effective interest rate method for all is entered into with the assignee, also known
financial instruments measured at amortised as the right of Excess Interest Spread (EIS). The
cost and financial instrument measured at fair future EIS basis the scheduled cash flows, on
value through other comprehensive income execution of the transaction, discounted at the
(‘FVOCI’) and fair value through profit and loss applicable rate entered into with the assignee is
(FVTPL). The EIR is the rate that exactly discounts recorded upfront in statement of profit and loss.
estimated future cash receipts through the
Income from direct assignment transaction
expected life of the financial instrument or,
represents the difference between the carrying
when appropriate, a shorter period, to the net
amount of the asset (or the carrying amount
carrying amount of the financial asset. For
allocated to the portion of the asset de-
financial assets at FVTPL transaction costs are
recognised) and consideration received (including
recognised in profit or loss at initial recognition.
any new asset obtained less any new liability).
The EIR (and therefore, the amortised cost of the
(d) Other operational revenue:
asset) is calculated by taking into account any
discount or premium on acquisition, fees and Other operational revenue represents income
costs that are an integral part of the EIR. The earned from the activities incidental to the
Company recognises interest income using a business and is recognised when the right to
rate of return that represents the best estimate receive the income is established as per the
of a constant rate of return over the expected life terms of the contract. This includes cheque
of the financial instrument. bouncing charges, late payment charges and
prepayment charges etc. which are recorded as
The interest income is calculated by applying the and when realised.
EIR to the gross carrying amount of non-credit
impaired financial assets (i.e. at the amortised 
The Company recognises revenue from
cost of the financial asset before adjusting for contracts with customers based on a five-step
any expected credit loss allowance). For credit- model as set out in IndAS 115:
impaired financial assets the interest income is Step 1: Identify contract(s) with a customer: A
recorded as and when realised. contract is defined as an agreement between
If expectations regarding the cash flows on the two or more parties that creates enforceable
financial asset are revised for reasons other than rights and obligations and sets out the criteria
credit risk, the adjustment is booked as a positive for every contract that must be met.
or negative adjustment to the carrying amount of Step 2: Identify performance obligations in the
the asset in the balance sheet with an increase or contract: A performance obligation is a promise
reduction in interest income. The adjustment is in a contract with a customer to transfer a good
subsequently amortised through Interest income or service to the customer.
in the statement of profit and loss.
Step 3: Determine the transaction price: The
(b) Net gain or fair value changes transaction price is the amount of consideration
Any differences between the fair values of to which the Company expects to be entitled
the financial assets classified as fair value in exchange for transferring promised goods
through the profit or loss, held by the Company or services to a customer, excluding amounts
on the balance sheet date is recognised as an collected on behalf of third parties.
unrealised gain/loss in the statement of profit Step 4: Allocate the transaction price to the
and loss. performance obligations in the contract: For a

Aye Finance Private Limited 91

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

contract that has more than one performance and a corresponding lease liability for all lease
obligation, the Company allocates the transaction arrangements in which it is a lessee. The Company
price to each performance obligation in an has not exercised the exemption to exclude short term
amount that depicts the amount of consideration leases or low value leases.
to which the Company expects to be entitled
Certain lease arrangements includes the options to
in exchange for satisfying each performance
extend or terminate the lease before the end of the
obligation.
lease term. ROU assets and lease liabilities includes
Step 5: Recognise revenue when (or as) the these options when it is reasonably certain that they
Company satisfies a performance obligation. will be exercised.

Revenue from contracts with customers is The right-of-use assets are initially recognised at
recognised when control of the goods or services cost, which comprises the initial amount of the lease
are transferred to the customer at an amount liability adjusted for any lease payments made at or
that reflects the consideration to which the prior to the commencement date of the lease plus
Company expects to be entitled in exchange for any initial direct costs less any lease incentives. They
those goods or services. are subsequently measured at cost less accumulated
depreciation and impairment losses.
Income from other financial charges including
cheque bouncing charges, foreclosure charges 
Right-of-use assets are depreciated from the
are collected from loan customers for early commencement date on a straight-line basis over
payment/closure of loan and are recognised on the shorter of the lease term and useful life of the
realisation. underlying asset. Right of use assets are evaluated
for recoverability whenever events or changes in
(e) Insurance claims:
circumstances indicate that their carrying amounts
Insurance claims are accounted for on the basis may not be recoverable. For the purpose of
of claims admitted/expected to be admitted and impairment testing, the recoverable amount (i.e. the
to the extent that the amount recoverable can be higher of the fair value less cost to sell and the value-
measured reliably and it is reasonable to expect in-use) is determined on an individual asset basis
ultimate collection. unless the asset does not generate cash flows that
2.5 Leases: are largely independent of those from other assets.
In such cases, the recoverable amount is determined
The Company evaluates each contract or arrangement,
for the Cash Generating Unit (CGU) to which the asset
whether it qualifies as lease as defined under Ind AS
belongs.
116
The lease liability is initially measured at amortised
The Company as a lessee cost at the present value of the future lease payments.
The Company’s lease asset classes primarily consist The lease payments are discounted using the interest
of leases for its various office spaces. The Company rate implicit in the lease or, if not readily determinable,
assesses whether a contract contains a lease, at using the incremental borrowing rates pertaining to
inception of a contract. A contract is, or contains, the Company. Lease liabilities are remeasured with
a lease if the contract conveys the right to control a corresponding adjustment to the related right of
the use of an identified asset for a period of time in use asset if the Company changes its assessment if
exchange for consideration. To assess whether a whether it will exercise an extension or a termination
contract conveys the right to control the use of an option.
identified asset, the Company assesses whether: (i)
Lease liability and ROU asset have been separately
the contract involves the use of an identified asset (ii)
presented in the balance sheet and lease payments
the Company has substantially all of the economic
have been classified as financing cash flows.
benefits from use of the asset through the period of
the lease and (iii) the Company has the right to direct 2.6 Employee benefits:
the use of the asset. Employee benefits include provident fund, employee
At the date of commencement of the lease, the state insurance scheme, gratuity fund and
Company recognises a right-of-use asset (“ROU”) compensated absences.

92 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

(a Short term employee benefits: (c) Long-term employee benefits

Employee benefits falling due wholly within Compensated absences with respect to
twelve months of rendering the service are leave encashment benefits payable to
classified as short term employee benefits employees of the Company while in service,
and are expensed in the period in which the on retirement, death while in service or on
employee renders the related service. Liabilities termination of employment with respect
recognised in respect of short-term employee to accumulated leaves outstanding at the
benefits are measured at the undiscounted year end are accounted for on the basis
amount of the benefits expected to be paid in of an actuarial valuation as at the balance
exchange for the related service. sheet date. The defined benefit obligation
is calculated annually by an actuary using
(b) Post employment benefits:
the projected unit credit method.
(i) Defined contribution plan
(d) Termination benefits

The Company’s contribution to
Employee Provident Fund, Employee Termination benefits such as
State Insurance Scheme and Labour compensation under employee separation
Welfare Fund under the relevant Acts schemes are recognised as expense when
are considered as defined contribution the Company’s offer of the termination
plans and are charged as an expense benefit is accepted or when the Company
based on the amount of contribution recognises the related restructuring costs
required to be made and when services whichever is earlier.
are rendered by the employees.
2.7 Taxation:
(ii) Defined benefit plan Income tax expense represents the sum of the tax
Benefits payable to eligible employees currently payable and deferred tax.
of the Company with respect to
(a) Current tax
gratuity, a defined benefit plan is
accounted for on the basis of an The tax currently payable is based on taxable
actuarial valuation as at the balance profit for the year. Taxable profit differs from
sheet date. In accordance with ‘profit before tax’ as reported in the statement
the Payment of Gratuity Act, 1972, of profit and loss because of items of income
the plan provides for lump sum or expense that are taxable or deductible in
payments to vested employees on other years and items that are never taxable
retirement, death while in service or deductible. The Company’s current tax
or on termination of employment is calculated using tax rates that have been
in an amount equivalent to 15 days enacted or substantively enacted by the end
basic salary for each completed of the reporting period and is measured in
year of service. Vesting occurs upon accordance with Income tax Act, 1961, Income
completion of five years of service. Computation and Disclosure Standards and
The present value of such obligation is other applicable tax laws.
determined by the projected unit credit Current tax assets and liabilities are offset only
method and adjusted for past service if there is a legally enforceable right to set off the
cost and fair value of plan assets as at recognised amounts, and it is intended to realise
the balance sheet date through which the asset and settle the liability on a net basis or
the obligations are to be settled. simultaneously.
The resultant actuarial gain or loss
(b) Deferred tax
on change in present value of the
defined benefit obligation is reflected Deferred tax is recognised on temporary
immediately in the balance sheet with differences between the carrying amounts of
a charge or credit recognised in other assets and liabilities in the financial statements
comprehensive income in the period and the corresponding tax bases used in the
in which they occur. computation of taxable profit. Deferred tax

Aye Finance Private Limited 93

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

liabilities are generally recognised for all taxable comprises its purchase price or construction
temporary differences. Deferred tax assets are cost, any costs directly attributable to bringing
generally recognised for all deductible temporary the asset into the location and condition
differences to the extent that it is probable that necessary for it to be capable of operating in
taxable profits will be available against which the manner intended by management, the initial
those deductible temporary differences can be estimate of any decommissioning obligation,
utilised. Such deferred tax assets and liabilities if any, and, for assets that necessarily take a
are not recognised if the temporary difference substantial period of time to get ready for their
arises from the initial recognition (other than in intended use, finance costs. Cost includes
a business combination) of assets and liabilities import duties and any non-refundable taxes
in a transaction that affects neither the taxable on such purchase, after deducting rebates and
profit nor the accounting profit. trade discounts and is inclusive of freight, duties,
taxes and other incidental expenses. All cost
The carrying amount of deferred tax assets is
are capitalised which are directly attributable
reviewed at the end of each reporting period and
to bringing assets to the condition and location
reduced to the extent that it is no longer probable
essential for it to operate in a manner as intended
that sufficient taxable profits will be available to
by the management. In respect of assets due for
allow all or part of the asset to be recovered.
capitalisation, where final bills/claims are to be
Deferred tax liabilities and assets are measured received/passed, the capitalisation is based on
at the tax rates that are expected to apply in the the engineering estimates. Final adjustments, for
period in which the liability is settled or the asset costs and depreciation are made retrospectively
realised, based on tax rates (and tax laws) that in the year of ascertainment of actual cost and
have been enacted or substantively enacted by finalisation of claim.
the end of the reporting period.
Subsequent expenditure incurred on assets put
The measurement of deferred tax liabilities and to use is capitalised only when it increases the
assets reflects the tax consequences that would future economic benefits / functioning capability
follow from the manner in which the Company from / of such assets.
expects, at the end of the reporting period, to
Capital work in progress includes the cost of
recover or settle the carrying amount of its
property plant and equipment that are not yet
assets and liabilities.
ready for their intended use and the cost of assets
Deferred tax assets and deferred tax liabilities not put to use before the Balance Sheet date.
are offset if a legally enforceable right exists
(b) Depreciation and amortisation
to set off current tax assets against current
tax liabilities and the deferred taxes relate to Depreciation is calculated on cost of items
the same taxable entity and the same taxation of property, plant and equipment less their
authority. estimated residual values over their estimated
useful lives using the written down value method,
(c) Current tax and deferred tax for the year and is generally recognised in the statement of
Current tax and deferred tax are recognised in profit and loss. The Company follows estimated
statement of profit or loss, except when they useful lives which are given under Part C of
relate to items that are recognised in other the Schedule II of the Companies Act, 2013.
comprehensive income or directly in equity, in Leasehold improvements are amortised over the
which case, the current and deferred tax are also period of lease.
recognised in other comprehensive income or

Depreciation on addition to property, plant
directly in equity respectively.
and equipment is provided on pro-rata basis
2.8 Property, plant and equipment: from the date the assets is acquired/installed.
(a) Property, plant and equipment Depreciation on sale/deduction from property,
plant and equipment is provided for up to the
Property, plant and equipment is stated at cost,
date of sale deduction and discernment as the
less accumulated depreciation and accumulated
case may be.
impairment losses. The initial cost of an asset

94 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

The estimated useful life and amortisation (d) Intangible Assets under development which are
method are reviewed at the end of each reporting under development as at the balance sheet date.
period, with the effect of any changes in estimate
2.10 Impairment of non financial assets
being accounted for on a prospective basis. In
respect of assets whose useful lives has been At the end of each reporting period, the Company
revised, the unamortised depreciable amount is reviews the carrying amounts of its tangible and
charged over the revised remaining useful lives intangible assets to determine whether there is
of the assets. any indication that those assets have suffered an
impairment loss. If any such indication exists, the
(c) Derecognition of property, plant and equipment recoverable amount of the asset is estimated in
An item of property, plant and equipment is order to determine the extent of the impairment
derecognised upon disposal or when no future loss (if any). When it is not possible to estimate
economic benefits are expected to arise from the recoverable amount of an individual asset,
the continued use of the asset. Any gain or loss the Company estimates the recoverable amount
arising on the disposal or retirement of an item of the cash-generating unit to which the asset
of property, plant and equipment is recognised belongs. When a reasonable and consistent basis
in profit or loss. of allocation can be identified, corporate assets are
also allocated to individual cash-generating units, or
2.9 Intangible assets: otherwise they are allocated to the smallest group of
(a) Recognition and measurement cash-generating units for which a reasonable and
Intangible assets with finite useful lives that consistent allocation basis can be identified.
are acquired separately are carried at cost less Recoverable amount is the higher of fair value less
accumulated amortisation and accumulated costs of disposal and value in use. In assessing value
impairment losses. Amortisation is recognised in use, the estimated future cash flows are discounted
on a written down basis over their estimated to their present value using a pre-tax discount rate
useful lives. The estimated useful life and that reflects current market assessments of the time
amortisation method are reviewed at the end value of money and the risks specific to the asset for
of each reporting period, with the effect of which the estimates of future cash flows have not
any changes in estimate being accounted been adjusted.
for on a prospective basis. Intangible assets
with indefinite useful lives that are acquired If recoverable amount of an asset (or cash generating
separately are carried at cost less accumulated unit) is estimated to be less than its carrying amount,
impairment losses. Subsequent expenditure such deficit is recognised immediately in the
incurred on assets put to use is capitalised only statement of profit and loss as impairment loss and
when it increases the future economic benefits / the carrying amount of the asset (or cash generating
functioning capability from / of such assets. unit) is reduced to its recoverable amount.

(b) Derecognition of Intangible assets An assessment is made annually as to see if there are
any indications that impairment losses recognised
An intangible asset is derecognised on disposal,
earlier may no longer exist or may have come
or when no future economic benefits are
down. The impairment loss is reversed, if there has
expected from use or disposal. Gains or losses
been a change in the estimates used to determine
arising from derecognition of an intangible
the asset’s recoverable amount since the previous
asset, measured as the difference between the
impairment loss was recognised. If it is so, the
net disposal proceeds and the carrying amount
carrying amount of the asset is increased to the lower
of the asset, are recognised in profit or loss
of its recoverable amount and the carrying amount
when the asset is derecognised.
that have been determined, net of depreciation, had
(c) Useful lives of intangible assets no impairment loss been recognised for the asset in
Estimated useful lives of the intangible asset prior years. After a reversal, the depreciation charge
for the current and comparative periods are as is adjusted in future periods to allocate the asset’s
follows: revised carrying amount, less any residual value,
on a systematic basis over its remaining useful life.
Computer software: 3 years

Aye Finance Private Limited 95

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

Reversals of Impairment loss are recognised in the The Company has constituted an Employee Stock
Statement of Profit and Loss. Option Plan 2016. The Plan provides for grant of
options to employees of the Company to acquire
2.11 Provisions, contingent liabilities and contingent equity shares of the Company that vest in a graded
assets: manner and that are to be exercised within a specified
(a) Provisions period.
Provisions are recognised when the Company The Company has constituted an Employee Stock
has a present obligation (legal or constructive) Option Plan 2020. The Company has transferred all
as a result of a past event, it is probable that the the ungranted options under Employee Stock Option
Company will be required to settle the obligation, Plan 2016 to Employee Stock Option Plan 2020 while
and a reliable estimate can be made of the options granted under the Employee Stock Option Plan
amount of the obligation. 2016 continue to be governed by the conditions of
Provision is measured using the cash flows Employee Stock Option Plan 2016. Both plans provide
estimated to settle the present obligation and for grant of options to employees of the Company to
when the effect of time value of money is material, acquire equity shares of the Company that vest in a
the carrying amount of the provision is the present graded manner and that are to be exercised within a
value of those cash flows. Reimbursement specified period.
expected in respect of expenditure required to
2.13 Financial instruments:
settle a provision is recognised only when it is
virtually certain that the reimbursement will be Financial assets and financial liabilities are recognised
received. when the Company becomes a party to the contractual
provisions of the instrument.
(b) Contingent liabilities
Financial assets and financial liabilities are initially
Contingent liabilities are disclosed when there is
measured at fair value. Transaction costs that are
a possible obligation arising from past events,
directly attributable to the acquisition or issue of
the existence of which will be confirmed only
financial assets and financial liabilities (other than
by the occurrence or non- occurrence of one
financial assets and financial liabilities at fair value
or more uncertain future events not wholly
through profit or loss) are added to or deducted
within the control of the Company or a present
from the fair value of the financial assets or financial
obligation that arises from past events where it is
liabilities, as appropriate, on initial recognition.
either not probable that an outflow of resources
Transaction costs directly attributable to the
will be required to settle or a reliable estimate of
acquisition of financial assets or financial liabilities
the amount cannot be made.
at fair value through profit or loss are recognised
(c) Contingent assets immediately in profit or loss.
Contingent assets are not recognised in the (a) Financial assets
financial statements, however they are disclosed
when an inflow of economic benefits is probable. Initial recognition and measurement
All financial assets are recognised initially at fair
2.12 Share-based payment arrangements: value and transaction costs that are attributable
The stock options granted to employees pursuant to to the acquisition of the financial asset are
the Company’s Stock Options Schemes, are measured adjusted to the fair value on initial recognition.
at the fair value of the options at the grant date in
accordance with IND AS 102, Share-based payments. Subsequent measurement
The fair value of the options is treated as discount and For the purpose of Subsequent measurement, the
accounted as employee compensation cost over the Company classifies financial assets in following
vesting period on a straight-line basis. The amount categories:
recognised as expense in each year is arrived at based
(i) Financial assets at amortised cost
on the number of grants expected to vest. If a grant
lapses after the vesting period, the cumulative discount (ii) Financial assets at fair value through other
recognised as expense in respect of such grant is comprehensive income (FVTOCI)
transferred to the general reserve within equity.

96 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

(iii) Financial assets at fair value through profit All other equity investments are measured at fair
or loss (FVTPL) value, with value changes recognised in Profit
and loss, except for those equity investments
Financial assets shall be measured at amortised for which the Company has elected to present
cost if both of the following conditions are met: the changes in fair value through OCI.
(i) The asset is held within a business model
whose objective is to hold assets for De-recognition of financial assets
collecting contractual cash flows, and The Company derecognises a financial asset
when the contractual rights to the cash flows
(ii) Contractual terms of the asset give rise on
from the financial asset expire, or it transfers
specified dates to cash flows that are solely
the rights to receive the contractual cash flows
payments of principal and interest (SPPI)
in a transaction in which substantially all of the
on the principal amount outstanding.
risks and rewards of ownership of the financial
A financial asset shall be measured at fair value asset are transferred or in which the Company
through other comprehensive income if both of neither transfers nor retains substantially all
the following conditions are met: of the risks and rewards of ownership and
does not retain control of the financial asset.
(i) The asset is held within a business model
The Company considers control to be
whose objective is achieved by both
transferred if and only if, the transferee has
collecting contractual cash flows and
the practical ability to sell the asset in its
selling financial assets; and
entirety to an unrelated third party and is able
(ii) Contractual terms of the asset give rise on to exercise that ability unilaterally and without
specified dates to cash flows that are solely imposing additional restrictions on the transfer.
payments of principal and interest (SPPI) When the Company has neither transferred nor
on the principal amount outstanding. retained substantially all the risks and rewards
and has retained control of the asset, the asset
All financial assets not classified as measured
continues to be recognised only to the extent
at amortised cost or FVTOCI as described above
of the Company’s continuing involvement, in
are measured at FVTPL
which case, the Company also recognises an
Subsequent measurement of financial assets associated liability. The transferred asset and

Financial assets at amortised cost are the associated liability are measured on a basis
subsequently measured at amortised cost that reflects the rights and obligations that the
using effective interest method. The amortised Company has retained.”
cost is reduced by impairment losses. Interest (b) Financial liabilities
income, foreign exchange gains and losses and
Initial recognition and measurement
impairment are recognised in Statement of profit
and loss. Any gain and loss on derecognition is All financial liabilities are recognised initially
recognised in statement of profit and loss. at fair value and transaction costs that are
attributable to the acquisition of the financial
Financial investment at FVOCI are subsequently
liabilities are adjusted to the fair value on initial
measured at fair value. Interest income under
recognition.
effective interest method, foreign exchange gains
and losses and impairment are recognised in Subsequent measurement
Statement of profit and loss. Other net gains and Subsequent to initial recognition, all liabilities
losses are recognised in OCI. On derecognition, are measured at amortised cost using the
gains and losses accumulated in OCI are effective interest method except for derivatives,
reclassified to statement of profit and loss. financial liabilities designated for measurement
at FVTPL which are measured at fair value.
Financial assets at FVTPL are subsequently
measured at fair value. Net gains and losses, De-recognition of financial liabilities
including any interest or dividend income, are A financial liabilities is de-recognised when the
recognised in statement of profit and loss. obligation under the liability is discharged or

Aye Finance Private Limited 97

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

cancelled or expires. When an existing financial because of financial difficulties of the borrower,
liability is replaced by another from the same then the gain or loss is presented together with
lender on substantially different terms, or the impairment losses. In other cases, it is presented
terms of an existing liability are substantially as interest income.
modified, such an exchange or modification
Financial liabilities
is treated as the de-recognition of the original
liability and the recognition of a new liability. The The Company derecognises a financial liability
difference in the respective carrying amounts is when its terms are modified and the cash
recognised in the statement of profit and loss. flows of the modified liability are substantially
different. In this case, a new financial liability
Offsetting of financial instruments based on the modified terms is recognised at
A financial asset and a financial liability is offset fair value. The difference between the carrying
and presented on net basis in the balance sheet amount of the financial liability extinguished and
when there is a current legally enforceable right the new financial liability with modified terms is
to set-off the recognised amounts and it is recognised in statement of profit and loss.
intended to either settle on net basis or to realise
2.14 Impairment of financial instruments:
the asset and settle the liability simultaneously.
In accordance with Ind-AS 109, the Company applies
Reclassification of financial assets and liabilities Expected Credit Loss (ECL) model for measurement
The Company doesn’t reclassify its financial and recognition of impairment loss for financial
assets and liabilities subsequent to their initial assets other than those measured through profit and
recognition. loss (FVTPL).

(a) Expected credit losses are measured through a

Modification of financial assets and financial
loss allowance at an amount equal to:
liabilities
The 12-months expected credit losses (expected
Financial assets
credit losses that result from those default events
The Company evaluates whether the cash flows on the financial instrument that are possible
from a financial asset are modified and the within 12 months after the reporting date); or
modified asset is substantially different. If the
cash flows are substantially different, then the Full lifetime expected credit losses (expected
contractual rights to cash flows from the original credit losses that result from all possible default
financial asset are deemed to have expired. In this events over the life of the financial instrument)
case, the original financial asset is derecognised Both LTECLs (Lifetime expected Credit losses) and
and a new financial asset is recognised at fair 12 months ECLs are calculated on collective basis.
value.
(b) Based on the above, the Company categorises
In case the cash flows of the modified asset its loans into Stage 1, Stage 2 and Stage 3, as
carried at amortised cost are not substantially described below:
different, then the modification does not result in
derecognition of the financial asset. In this case, Stage 1
the Company recalculates the gross carrying When loans are first recognised, the Company
amount of the financial asset as the present recognises an allowance based on 12 months
value of the renegotiated or modified contractual ECL. Stage 1 loans includes those loans where
cash flows that are discounted at the financial there is no significant increase in credit risk
asset’s original effective interest rate and observed and also includes facilities where the
recognises the amount arising from adjusting credit risk has been improved and the loan has
the gross carrying amount as modification gain been reclassified from stage 2 or stage 3.
or loss in statement of profit and loss. Any costs
Stage 2
or fees incurred adjust the carrying amount of
the modified financial asset and are amortised When a loan has shown a significant increase in
over the remaining term of the modified financial credit risk since origination, the Company records
asset. If such a modification is carried out an allowance for the life time ECL. Stage 2 loans

98 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

also includes facilities where the credit risk has at a given time. It is based on the difference
improved and the loan has been reclassified between the contractual cash flows due and
from stage 3 and facilities where the credit risk those that the lender would expect to receive,
has been increased due to restructuring and including from the realisation of any collateral. It
loan has been reclassified from stage 1. is usually expressed as a percentage of the EAD.

Stage 3 The Company has calculated PD, EAD and LGD

to determine impairment loss on the portfolio
Loans considered credit impaired are the loans
of loans. At every reporting date, the above
which are past due for more than 90 days. The
calculated PDs, EAD and LGDs are reviewed and
Company records an allowance for life time ECL.
changes in the forward looking estimates are
Definition of Default analysed.
The Company considers a financial instrument Forward looking information
as defaulted and considered it as Stage 3 (credit-
While estimating the expected credit losses,
impaired) for ECL calculations in all cases, when
the Company reviews macro-economic
the borrower becomes more than 90 days past
developments occurring in the economy and
due on its contractual payments.
market it operates in. On a periodic basis, the
Significant increase in credit risk Company analyses if there is any relationship
The Company continuously monitors all assets between key economic trends like GDP,
subject to ECLs. In order to determine whether Unemployment rates, Benchmark rates set by
an instrument or a portfolio of instruments the Reserve Bank of India, inflation etc. with the
is subject to 12mECL or LTECL, the Company estimate of PD, LGD determined by the Company
assesses whether there has been a significant based on its internal data. While the internal
increase in credit risk since initial recognition. estimates of PD, LGD rates by the Company may
The Company considers an exposure to have not be always reflective of such relationships,
significantly increased in credit risk when temporary overlays are embedded in the
contractual payments are more than 30 days methodology to reflect such macro-economic
past due. trends reasonably.

(c) Calculation of ECLs The mechanics of the ECL method are

summarised below:
The mechanics of ECL calculations are outlined
below and the key elements are, as follows: Stage 1
The 12 months ECL is calculated as the portion
Probability of Default (PD)
of LTECLs that represent the ECLs that result
Probability of Default (PD) is an estimate of the from default events on a financial instrument
likelihood of default over a given time horizon. that are possible within the 12 months after the
A default may only happen at a certain time reporting date. The Company calculates the 12
over the assessed period, if the facility has not months ECL allowance based on the expectation
been previously derecognised and is still in the of a default occurring in the 12 months following
portfolio. the reporting date. These expected 12-months
default probabilities are applied to the EAD and
Exposure at Default (EAD)
multiplied by the expected LGD.
Exposure at Default (EAD) is an estimate of the
exposure at a future default date, taking into 
Stage 2
account expected changes in the exposure after When a loan has shown a significant increase
the reporting date. in credit risk since origination, the Company
records an allowance for the LTECLs. The
Loss Given Default (LGD)
mechanics are similar to those explained above,
Loss Given Default (LGD) is an estimate of the but PDs and LGDs are estimated over the lifetime
loss arising in the case where a default occurs of the instrument.

Aye Finance Private Limited 99

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

Stage 3 / Regulatory Stage 3 Hedges that meet the criteria for hedge accounting

For loans considered credit-impaired, the are accounted for, as described below:
Company recognises the lifetime expected credit Fair value hedges the exposure to changes in the fair
losses for these loans. The method is similar to value of a recognised asset or liability, or an identified
that for Stage 2 assets, with the PD set at 100%. portion of such an asset, liability, that is attributable to
(d) Loss allowances for ECL are presented in the a particular risk and could affect profit or loss.
statement of financial position as follows: For designated and qualifying fair value hedges, the
(i) for financial assets measured at amortised cumulative change in the fair value of a hedging
cost: as a deduction from the gross carrying derivative is recognised in the statement of profit
amount of the assets; and loss in net gain/(loss) on fair value changes.
Meanwhile, the cumulative change in the fair value
(ii) for debt instruments measured at FVTOCI:
of the hedged item attributable to the risk hedged is
no loss allowance is recognised in Balance
recorded as part of the carrying value of the hedged
Sheet as the carrying amount is at fair value.
item in the balance sheet and is also recognised in the
(e) Write offs statement of profit and loss in net gain/(loss) on fair
Loans and debt securities are written off when value changes.
the Company has no reasonable expectations
2.16 Fair value measurement
of recovering the financial asset (either in its
entirety or a portion of it). This is the case when Fair value is the price at the measurement date, at
the Company determines that the borrower which an asset can be sold or paid to transfer a liability,
does not have assets or sources of income that in an orderly transaction between market participants
could generate sufficient cash flows to repay at the measurement date. The Company’s accounting
the amounts subject to the write-off. A write-off policies require, measurement of certain financial
constitutes a derecognition event. The Company / non-financial assets and liabilities at fair values
may apply enforcement activities to financial (either on a recurring or non-recurring basis). Also,
assets written off. Recoveries resulting from the the fair values of financial instruments measured at
Company’s enforcement activities will result in amortised cost are required to be disclosed in the
impairment gains. said financial statements. The Company is required
to classify the fair valuation method of the financial
2.15 Derivative financial instruments / non-financial assets and liabilities, either measured
The Company enters into derivative financial or disclosed at fair value in the financial statements,
instruments, primarily foreign exchange forward using a three level fair-value-hierarchy which reflects
contracts, currency swaps and interest rate swaps, to the significance of inputs used in the measurement).
manage its borrowing exposure to foreign exchange Accordingly, the Company uses valuation techniques
and interest rate risks. Derivatives embedded in non- that are appropriate in the circumstances and for
derivative host contracts are treated as separate which sufficient data is available to measure fair
derivatives when their risks and characteristics are value, maximizing the use of relevant observable
not closely related to those of the host contracts inputs and minimizing the use of unobservable inputs.
and the host contracts are not measured at All assets and liabilities for which fair value is
FVTPL. Derivatives are initially recognised at fair measured or disclosed in the financial statements are
value at the date the contracts are entered into and categorized within the fair value hierarchy described
are subsequently remeasured to their fair value at the as follows:
end of each reporting period. The resulting gain/loss (a) Level 1 financial instruments
is recognised in statement of profit and loss.
Those where the inputs used in the valuation are
Hedge accounting unadjusted quoted prices from active markets for
The Company makes use of derivative instruments identical assets or liabilities that the Company
to manage exposures to interest rate and foreign has access to at the measurement date. The
currency. In order to manage particular risks, the Company considers markets as active only if
Company applies hedge accounting for transactions there are sufficient trading activities with regards
that meet specified criteria. to the volume and liquidity of the identical

100 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

assets or liabilities and when there are binding assets are managed together to achieve a particular
and exercisable price quotes available on the business objective. This assessment includes
balance sheet date. judgement reflecting all relevant evidence including
how the performance of the assets is evaluated
(b) Level 2 financial instruments
and their performance measured, the risks that
Those where the inputs that are used for valuation affect the performance of the assets and how
and are significant, are derived from directly or these are managed and how the managers of the
indirectly observable market data available over assets are compensated. The Company monitors
the entire period of the instrument’s life. financial assets measured at amortised cost that are
(c) Level 3 financial instruments derecognised prior to their maturity to understand
Include one or more unobservable input where the reason for their disposal and whether the reasons
there is little market activity for the asset/liability are consistent with the objective of the business for
at the measurement date that is significant to which the asset was held. Monitoring is part of the
the measurement as a whole. Company’s continuous assessment of whether the
business model for which the remaining financial
2.17 Significant management judgements in applying assets are held continues to be appropriate and if it is
accounting policies and estimation uncertainty not appropriate whether there has been a change in
The preparation of financial statements requires the business model and so a prospective change to the
use of accounting estimates which, by definition, classification of those assets.
will seldom equal the actual results. Management Fair value of financial instruments : The fair value
also needs to exercise judgement in applying the of financial instruments is the price that would be
Company’s accounting policy. This note provides an received to sell an asset or paid to transfer a liability
overview of the areas that involved a higher degree in an orderly transaction in the principal (or most
of judgement or complexity, and of items which are advantageous) market at the measurement date
more likely to be materially adjusted due to estimates under current market conditions (i.e. an exit price)
and assumptions turning out to be different than regardless of whether that price is directly observable
those originally assessed. Detailed information about or estimated using another valuation technique.
each of these estimates and judgements is included When the fair values of financial assets and financial
in relevant notes together with information about the liabilities recorded in the balance sheet cannot be
basis of calculation for each affected line item in the derived from active markets, they are determined
financial statements. using a variety of valuation techniques that include
The following are significant management the use of valuation models. The inputs to these
estimation/uncertainty and judgement in applying models are taken from observable markets where
the accounting policies of the Company that have the possible, but where this is not feasible, estimation is
most significant effect on the financial statements: required in establishing fair values.

Defined benefit obligation Effective Interest Rate (EIR) method : The Company
recognises interest income / expense using a rate of
Management estimates of these obligation is based
return that represents the best estimate of a constant
on a number of critical underlying assumptions such
rate of return over the expected life of the loans
as standard rates of inflation, mortality, discount rate
given / taken. This estimation, by nature, requires
and anticipation of future salary increases. Variation
an element of judgement regarding the expected
in these assumptions may significantly impact the
behaviour and life-cycle of the instruments, as well
defined benefit obligation amount and the annual
as expected changes to other fee income/expense
defined benefit expenses.
that are integral parts of the instrument.
Business model assessment
Recognition of deferred tax assets
Classification and measurement of financial assets
The extent to which deferred tax assets can be
depends on the results of business model and the
recognised is based on an assessment of the
solely payments of principal and interest (“SPPI”)
probability of the Company’s future taxable income
test. The Company determines the business model
against which the deferred tax assets can be utilised.
at a level that reflects how groups of financial

Aye Finance Private Limited 101

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)

Property, plant and equipment Determination of lease term

Measurement of useful life and residual values of Ind AS 116 Leases requires lessee to determine the
property, plant and equipment and useful life of lease term as the non-cancellable period of a lease
intangible assets. adjusted with any option to extend or terminate the
lease, if the use of such option is reasonably certain.
Evaluation of indicators for impairment of assets
The Company makes assessment on the expected

The evaluation of applicability of indicators of lease term on lease by lease basis and thereby
impairment of assets requires assessment of several assesses whether it is reasonably certain that any
external and internal factors which could result in options to extend or terminate the contract will be
deterioration of recoverable amount of the assets. exercised. In evaluating the lease term, the Company
Contingent liabilities considers factors such as any significant leasehold
At each balance sheet date basis the management improvements undertaken over the lease term, costs
judgment, changes in facts and legal aspects, the relating to the termination of lease and the importance
Company assesses the requirement of provisions of the underlying to the Company’s operations taking
against the outstanding contingent liabilities. into account the location of the underlying asset
However the actual future outcome may be different and the availability of the suitable alternatives. The
from this judgement. lease term in future periods is reassessed to ensure
that the lease term reflects the current economic
Impairment of financial assets circumstances.
At each balance sheet date, based on historical default
Discount rate for lease liability
rates observed over expected life, the management
assesses the expected credit losses on outstanding The discount rate is generally based on the incremental
receivables and advances. The Company’s expected borrowing rate specific to the lease being evaluated or
credit loss (“ECL”) calculations are outputs of complex for a portfolio of leases with similar characteristics.
models with a number of underlying assumptions And discount rate of security deposits is generally
regarding the choice of variable inputs and their based on the SBI deposit rate at the time of deposit.
interdependencies. Fair value of share-based payments
These estimates and judgements are based on Estimating fair value for share-based payment
historical experience and other factors, including transactions requires determination of the most
expectations of future events that may have a financial appropriate valuation model, which depends on the
impact on the Company and that are believed to be terms and conditions of the grant. This estimate
reasonable under the circumstances. Management also requires determination of the most appropriate
believes that the estimates used in preparation of inputs to the valuation model including the expected
the standalone financial statements are prudent and life of the share option or appreciation right, volatility
reasonable. and dividend yield and making assumptions about
them. For the measurement of the fair value of equity-
settled transactions with employees at the grant date,
the Company uses a Black-Scholes model.

102 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

3 CASH AND CASH EQUIVALENTS

As at As at
March 31, 2024 March 31, 2023
Cash on hand 9.20 4.93
Balances with banks:
On current accounts 227.14 37.37
Deposit with original maturity of less than three months 290.25 230.33
526.59 272.63

Note (1): Cash in hand includes balance in prepaid cards obtained by Company for its routine expenses from the banks.

Note (2): Balances with banks in current accounts do not earn any interest. Short-term deposits are made for varying
periods of between one day and three months, depending upon the immediate cash requirements of the Company, and
earn interest at the respective short-term deposit rates.

4 BANK BALANCES OTHER THAN CASH AND CASH EQUIVALENTS

As at As at
March 31, 2024 March 31, 2023
Fixed deposit with original maturity for more than three months 46.34 5.00
Balances with banks to the extent held as margin money or security against
borrowing, guarantees and other commitments
Balance held as security against borrowings 6.51 37.40
Balance held as security against securitisation 150.82 79.02
203.67 121.42

Note: Fixed deposits and margin money deposits with banks earns interest at fixed rates or floating rates based on
daily bank deposit rates.

5 LOAN PORTFOLIO

As at As at
March 31, 2024 March 31, 2023
Revolving working capital - 0.01
Term loans 4,129.66 2,605.69
Staff loan 3.74 3.22
Total - Gross 4,133.40 2,608.92
Less: Impairment loss allowance 130.28 53.48
Total - Net 4,003.12 2,555.44
(A) As per NBFC Directions
(I) Others 4,133.40 2,608.92
(II) To Related parties - -
Total (A) Gross 4,133.40 2,608.92
Less: Impairment loss allowance 130.28 53.48
Total (A) Net 4,003.12 2,555.44
(B) Based on security
(I) Secured 2,474.21 1,792.74
(II) Unsecured 1,659.19 816.18
Total (B) Gross 4,133.40 2,608.92
Less: Impairment loss allowance 130.28 53.48
Total (B) Net 4,003.12 2,555.44

Aye Finance Private Limited 103

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

As at As at
March 31, 2024 March 31, 2023
(C) Based on region
(I) Loans in India
(i) Public sector - -
(ii) Others 4,133.40 2,608.92
Total (C) (I) Gross 4,133.40 2,608.92
Less: Impairment loss allowance 130.28 53.48
Total (C) (I) Net 4,003.12 2,555.44
(II) Loans outside India - -
Less: Impairment loss allowance - -
Total (C) (II) Net - -
Total (C) (I) and (C) (II) 4,003.12 2,555.44

Note:
For the year ended March 31, 2024, management overlay of ` 20.01 crore is considered in Stage 3 of the Hypothecated
Portfolio, as an additional provision, to factor future contingency and change in market conditions basis the risk
perceived and as a matter of prudence, taking the overall ECL to ` 130.28 crore as of 31 March 2024.

6 INVESTMENTS

As at As at
March 31, 2024 March 31, 2023
Investments measured at fair value through profit or loss
Mutual funds - 58.51
Mutual Funds held as security in respect of borrowings - -
Security receipts
ARCIL - trust 15.71 30.80
Less: Impairment loss allowance 5.10 5.10
Investments carried at Fair value through Profit or loss 10.61 84.21
Investment in subsidiary at cost (unquoted)
249,999 equity shares of RS 10 in Foundation for Advancement of Micro
0.25 0.25
Enterprises (FAME)
Provision on investments ** 0.25 -
Investments measured at amortised cost - 0.25
Gross investments 15.71 89.56
Based on region:
Investments outside India - -
Investments in India 15.71 89.56
Less: Allowance for impairment loss 5.10 5.10
10.61 84.46

** During the financial year 2019-20 , the Company had subscribed 2,49,999 equity shares of ` 10/- each of Foundation
for Advancement of Micro Enterprises (FAME) (a Section 8 - Company as per Companies Act 2013)}. Foundation for
Advancement of Micro Enterprises (FAME) became a subsidiary of the Company w.e.f. 04/04/2019 by virtue of holding
2,49,999 equity shares equivalent to 99.99% share capital in Foundation for Advancement of Micro Enterprises (FAME).
Foundation for Advancement of Micro Enterprises (FAME) is prohibited to distribute any dividend / economic benefits
to its members; hence the Company is unable to earn any variable return/ economic benefits from the voting rights
through its holding in equity shares of Foundation for Advancement of Micro Enterprises (FAME). Accordingly, the
above investment does not meet the definition of control under Indian Accounting Standard (Ind AS) 110 - Consolidated
Financial Statements and the aforesaid investment value of ` 0.25 Crore has been impaired to the Statement of profit
and loss for the year ended March 31, 2024.

104 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

7 OTHER FINANCIAL ASSETS (AT AMORTISED COST)

As at As at
March 31, 2024 March 31, 2023
Receivable from insurance company 3.87 1.74
Security deposits 3.06 2.66
Other receivables 23.73 18.41
30.66 22.81

8 CURRENT TAX ASSETS (NET)

As at As at
March 31, 2024 March 31, 2023
Advance income tax (net of provision) 11.73 18.08
11.73 18.08

9 DEFERRED TAX ASSETS (NET)

As at As at
March 31, 2024 March 31, 2023
Deferred tax assets (net) 43.94 29.34
43.94 29.34

Aye Finance Private Limited 105

 10A Property, plant and equipment

106
Particulars Gross carrying amount Accumulated depreciation Net
carrying
amount
As at Additions Disposals Adjustments As at As at Depreciation Disposals Adjustments As at As at
April 01, March April 01, for the year March March
2023 31, 2024 2023 31, 2024 31, 2024
Furniture and fixtures 2.19 0.03 0.01 0.26 2.47 1.55 0.16 0.00 0.26 1.97 0.50
Office equipments 2.87 0.62 0.58 0.25 3.16 1.80 0.54 0.54 0.25 2.05 1.11
Electrical installations and
0.96 0.17 - 0.06 1.19 0.50 0.13 - 0.06 0.69 0.50
equipments
Computers 11.15 7.07 0.82 0.75 18.15 7.99 3.44 0.79 0.75 11.39 6.76
Leasehold improvements 0.98 - - 0.02 1.00 0.84 0.05 - 0.02 0.91 0.09
18.15 7.89 1.41 1.34 25.97 12.68 4.32 1.33 1.34 17.01 8.96
(All amounts are in ` crore unless otherwise stated)

Particulars Gross carrying amount Accumulated depreciation Net

carrying
amount
As at Additions Disposals Adjustments As at As at Depreciation Disposals Adjustments As at As at
April 01, March April 01, for the year March March
2022 31, 2023 2022 31, 2023 31, 2023
Furniture and fixtures 2.19 - - - 2.19 1.33 0.22 - - 1.55 0.64
Office equipments 2.31 0.62 0.06 - 2.87 1.35 0.51 0.06 - 1.80 1.06
Electrical installations and
0.91 0.05 - - 0.96 0.35 0.15 - - 0.50 0.46
equipments
Computers 8.60 3.02 0.47 - 11.15 6.45 1.98 0.44 - 7.99 3.16
Leasehold improvements 0.98 - - - 0.98 0.73 0.11 - - 0.84 0.14
14.99 3.69 0.53 - 18.15 10.21 2.97 0.50 - 12.68 5.46

Annual Report 2023-24

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
 10B Right of use assets (ROU)
Particulars Gross carrying amount Accumulated depreciation Net
carrying
amount
As at Additions Disposals Adjustments As at As at Depreciation Disposals Adjustments As at As at
April 01, March April 01, for the year March March
2023 31, 2024 2023 31, 2024 31, 2024
Right of use assets 28.46 11.20 8.78 - 30.88 7.31 9.46 7.32 - 9.45 21.43
28.46 11.20 8.78 - 30.88 7.31 9.46 7.32 - 9.45 21.43

Aye Finance Private Limited

Particulars Gross carrying amount Accumulated depreciation Net
carrying
amount
As at Additions Disposals Adjustments As at As at Depreciation Disposals Adjustments As at As at
April 01, March April 01, for the year March March
2022 31, 2023 2022 31, 2023 31, 2023
(All amounts are in ` crore unless otherwise stated)

Right of use assets 26.02 8.34 5.90 - 28.46 5.45 7.32 5.46 - 7.31 21.15
26.02 8.34 5.90 - 28.46 5.45 7.32 5.46 - 7.31 21.15

10C Intangible assets

Particulars Gross carrying amount Accumulated depreciation Net
carrying
amount
As at Additions Disposals Adjustments As at As at Depreciation Disposals Adjustments As at As at
April 01, March April 01, for the year March March
2023 31, 2024 2023 31, 2024 31, 2024
Computer software 5.05 1.23 0.14 0.14 6.28 4.49 0.77 0.13 (0.17) 4.96 1.32
5.05 1.23 0.14 0.14 6.28 4.49 0.77 0.13 (0.17) 4.96 1.32

Particulars Gross carrying amount Accumulated depreciation Net

carrying
amount
As at Additions Disposals Adjustments As at As at Depreciation Disposals Adjustments As at As at
April 01, March April 01, for the year March March
2022 31, 2023 2022 31, 2023 31, 2023
Financial Statements

Computer software 4.70 0.35 - - 5.05 3.33 1.16 - - 4.49 0.55

4.70 0.35 - - 5.05 3.33 1.16 - - 4.49 0.55

107
NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

11 OTHER NON-FINANCIAL ASSETS

As at As at
March 31, 2024 March 31, 2023
TDS recoverable 0.01 0.01
Goods and service tax receivable - 0.78
Prepaid expenses 3.31 2.52
Employees advances 0.40 0.39
Others 4.35 1.43
8.07 5.13

12 DERIVATIVE FINANCIAL INSTRUMENTS

As at As at
March 31, 2024 March 31, 2023
Carried at fair value [Assets / (Liability)]
Cross currency swap rate contract not designated in hedge accounting
-3.15 3.07
relationship
-3.15 3.07

13 DEBT SECURITIES (AT AMORTISED COST)

As at As at
March 31, 2024 March 31, 2023
Redeemable non-convertible debentures
Secured 912.64 771.92
Unsecured 109.70 127.93
1,022.34 899.85
Based on region:
Debt securities in India 1,022.34 899.85
Debt securities in outside India - -
1,022.34 899.85

Note: Refer Note 13(i) below for the repayment details along with rate of interest and security details.

13 
(i) Details of terms of repayment for the other long-term borrowings and security provided in respect of the secured
other long-term borrowings

Particulars As at As at
March 31, 2024 March 31. 2023
ISIN Issuance Date Redemption Interest Secured Unsecured Secured Unsecured
Date Rate
INE501X08065 March 29, 2022 April 30, 2023 11.25% - - - 10.00
INE501X07190 May 22, 2020 May 22, 2023 13.50% - - 1.38 -
13.47%
INE501X07042 August 29, 2017 August 29, 2023 - - 44.00 -
and 13.55%
September 02,
INE501X07240 September 07, 2023 9.68% - - 50.00 -
2021
INE501X07273 March 25, 2022 September 25, 2023 9.50% - - 15.00 -
INE501X07141 October 25, 2019 October 25, 2023 10.78% - - 93.75 -
September 05,
INE501X07307 March 05, 2024 9.75% - - 50.00 -
2022

108 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Particulars As at As at
March 31, 2024 March 31. 2023
ISIN Issuance Date Redemption Interest Secured Unsecured Secured Unsecured
Date Rate
INE501X08032 March 06, 2019 March 06, 2024 12.14% - - - 20.00
INE501X07265 March 24, 2022 March 24, 2024 10.70% - - 12.50 -
INE501X07281 March 25, 2022 March 25, 2024 9.90% - - 15.00 -
September 28,
INE501X07323 March 27, 2024 10.50% - - 25.00 -
2022
January 24,
INE501X07372 April 25, 2024 10.50% 10.00 - 50.00 -
2023
December 08,
INE501X07232 May 13, 2024 10.70% 0.01 - 0.01 -
2020
December 05,
INE501X07414 June 05, 2024 10.00% 100.00 - 100.00 -
2022
INE501X07422 April 11, 2023 July 25, 2024 10.59% 12.00 - - -
November 08,
INE501X07166 November 08, 2024 12.50% 0.01 - - -
2019
INE501X07463 August 08, 2023 December 08, 2024 10.60% 22.50 - - -
December 13,
INE501X08073 December 31, 2024 12.70% - 11.70 - 23.40
2022
INE501X07448 July 26, 2023 January 26, 2025 10.60% 16.66 - - -
INE501X07455 August 02, 2023 February 02, 2025 10.50% 16.66 - - -
INE501X07471 August 25, 2023 February 25, 2025 10.50% 23.33 - - -
September 04,
INE501X07489 March 04, 2025 8.60% 40.00 - - -
2023
September 14,
INE501X07497 March 14, 2025 9.00% 26.67 - - -
2023
February 28,
INE501X08057 March 15, 2025 11.35% - 37.50 - 37.50
2022
February 28,
INE501X08057 March 15, 2025 11.35% - 37.50 - 37.50
2022
INE501X07406 March 24, 2023 March 31, 2025 10.70% 16.90 - 33.80 -
INE501X07430 May 18, 2023 April 30, 2025 10.70% 27.90 - - -
February 08,
INE501X07380 May 08, 2025 11.25% 8.33 - 15.00 -
2023
December 21,
INE501X07257 May 13, 2025 10.20% 0.01 - 22.22 -
2021
February 15,
INE501X07398 May 15, 2025 11.25% 15.00 - 27.00 -
2023
INE501X07125 June 26, 2019 June 26, 2025 13.00% 26.25 - 26.25 -
December 06,
INE501X07364 July 31, 2025 12.55% 10.00 - 15.00 -
2022
February 23,
INE501X07547 August 23, 2025 9.50% 50.00 - - -
2024
September 25,
INE501X07505 August 31, 2025 10.75% 37.50 - - -
2023

Aye Finance Private Limited 109

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Particulars As at As at
March 31, 2024 March 31. 2023
ISIN Issuance Date Redemption Interest Secured Unsecured Secured Unsecured
Date Rate
September 27,
INE501X07513 September 27, 2025 11.00% 18.75 - - -
2023
INE501X07562 March 22, 2024 October 07, 2025 9.50% 50.00 - - -
January 24,
INE501X08081 January 24, 2026 11.60% - 22.92 - -
2024
INE501X07554 March 06, 2024 March 06, 2026 10.75% 90.00 - - -
November 24,
INE501X07539 September 15, 2026 11.15% 50.00 - - -
2023
INE501X07299 July 29, 2022 July 28, 2027 11.16% 31.00 - 31.00 -
September 20,
INE501X07315 September 20, 2027 11.20% 26.00 - 26.00 -
2022
November 15,
INE501X07349 November 15, 2027 11.20% 31.00 - 31.00 -
2022
September 13,
INE501X07331 March 08, 2028 11.00% 32.73 - 32.73 -
2022
September 13,
INE501X07331 March 08, 2028 11.00% 32.73 - 32.73 -
2022
September 29,
INE501X07521 September 27, 2029 11.60% 76.50 - - -
2023
898.44 109.62 749.36 128.40
Accrued Interest 23.90 0.42 28.56 0.38
EIR Impact -9.70 -0.34 -6.00 -0.85
912.64 109.70 771.92 127.93

Note : Secured Non-Convertible Debentures of the Company are secured by way of first exclusive charge on hypothecated
book debts of the Company up to the extent minimum of 100% of the amount outstanding.

14 BORROWINGS (OTHER THAN DEBT SECURITIES AT AMORTISED COST)

As at As at
March 31, 2024 March 31, 2023
Borrowings measured at amortised cost:
Secured
Term loans
From banks 680.33 90.88
From other financial institutions 585.52 369.26
External commercial borrowings 363.74 266.18
Unsecured
Term loans
From other financial institutions 41.21 64.95
Liabilities in respect of securitised transactions
From banks 396.47 292.59
From non-banking financial companies 404.38 269.45

110 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

As at As at
March 31, 2024 March 31, 2023
Loans repayable on demand*
From banks 5.00 43.00
From other financial institutions - -
2,476.65 1,396.31
Borrowings in India 2,112.91 1,130.13
Borrowings outside India 363.74 266.18
2,476.65 1,396.31

* Secured by hypothecation of specific loan receivables (current and future) / cash and cash equivalents of the
Company.

Refer Note 14(i) below, for the repayment details along with rate of interest and security details.

14 (i) Details of terms of repayment for the other long-term borrowings and security provided in respect of the secured
other long-term borrowings:

a) Terms of principal repayment of borrowings (other than debt securities & securitisation) as on March 31, 2024
Original Maturity Due within Due between Due Between Due between Total
of loan and ROI 1 Years 1 to 2 Years 2 to 3 Years 3 to 4 years Amount
No of Amount No of Amount No of Amount No of Amount
Instalments Instalments Instalments Instalments
Bullet
9.51% - 10.00% 1 5.00 - - - - - - 5.00
10.51% - 11.00% 1 41.69 - - - - - - 41.69
12.51% - 13.00% - - 1 0.13 1 108.26 - - 108.39
13.01% - 13.50% - - - - 1 27.07 1 95.88 122.95
Monthly
9.01% - 9.50% 10 4.30 13 8.13 - - - - 12.43
9.51% - 10.00% 12 14.29 106 197.26 - - - - 211.55
10.01% - 10.50% 20 41.46 80 141.25 27 27.00 36 25.00 234.71
10.51% - 11.00% 9 6.82 84 159.17 59 62.76 - - 228.75
11.01% - 11.50% 40 53.46 180 228.45 36 10.00 - - 291.91
11.51% - 12.00% 13 18.15 92 97.18 49 67.78 - - 183.11
12.01% - 12.50% 24 25.64 - - - - - 25.64
Quarterly
10.01% - 10.50% - - - - 12 50.00 - - 50.00
10.51% - 11.00% 4 8.33 6 15.00 - - - - 23.33
11.01% - 11.50% 1 2.08 6 17.14 - - 19.22
12.01% - 12.50% - - 18 27.71 - - 27.71
Yearly
12.51% - 13.00% - - - - 3 83.37 - - 83.37
Accrued interest 12.64
EIR impact -6.59
135 221.22 586 891.42 188 436.24 37 120.88 1,675.80

Aye Finance Private Limited 111

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

b) Terms of principal repayment of borrowings (securitisation) as on March 31, 2024

Original Maturity Due within Due between Due Between Due between Total
of loan and ROI 1 Years 1 to 2 Years 2 to 3 Years 3 to 4 years Amount
No of Amount No of Amount No of Amount No of Amount
Instalments Instalments Instalments Instalments
Monthly
8.51% - 9.00% 5 0.65 - - - - - - 0.65
9.51% - 10.00% 7 2.74 36 53.25 - - - - 55.99
10.01% - 10.50% 94 212.26 173 528.31 - - - - 740.57
10.51% - 11.00% 3 2.88 - - - - - - 2.88
Accrued Interest 2.49
EIR Impact -1.73
109 218.53 209 581.56 - - - - 800.85

14 (i) Details of terms of repayment for the other long-term borrowings and security provided in respect of the secured
other long-term borrowings:

a) Terms of Principal Repayment of Borrowings (other than debt securities & securitisation) as on March 31, 2023
Original Maturity Due within Due between Due Between Due between Total
of loan and ROI 1 Years 1 to 2 Years 2 to 3 Years 3 to 4 years Amount
No of Amount No of Amount No of Amount No of Amount
Instalments Instalments Instalments Instalments
Bullet
9.01% - 9.50% 1 15.00 - - - - - - 15.00
10.01% - 10.50% 2 23.00 - - - - - - 23.00
10.51% - 11.00% - - 1 41.11 - - - - 41.11
11.01% - 11.50% 2 134.41 - - - - - - 134.41
12.01% - 12.50% 4 40.00 - - - - - - 40.00
Monthly
9.01% - 9.50% 24 17.91 21 8.75 - - - - 26.66
9.51% - 10.00% - - 44 48.96 - - - - 48.96
10.51% - 11.00% 29 29.88 37 31.63 - - - - 61.51
11.01% - 11.50% - - 103 81.87 27 31.25 - - 113.12
11.51% - 12.00% 23 11.82 76 86.36 64 68.24 - - 166.42
12.01% - 12.50% 12 6.00 - - - - - - 6.00
Quarterly
10.51% - 11.00% 8 16.67 - - - - - - 16.67
11.01% - 11.50% - - 5 10.42 - - - - 10.42
11.51% - 12.00% - - 7 17.50 11 22.92 - - 40.42
Half Yearly
12.51% - 13.00% - - - - 3 82.22 - - 82.22
Accrued Interest 10.47
EIR Impact -2.12
Total 105 294.69 294 326.60 105 204.63 - - 834.27

112 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

b) Terms of Principal Repayment of Borrowings (securitisation) as on March 31, 2023

Original Maturity Due within Due between Due Between Due between Total
of loan and ROI 1 Years 1 to 2 Years 2 to 3 Years 3 to 4 years Amount
No of Amount No of Amount No of Amount No of Amount
Instalments Instalments Instalments Instalments
Monthly
9.01% - 9.50% 12 5.64 6 1.09 - - - - 6.73
9.51% - 10.00% 44 95.30 13 12.03 - - - - 107.34
10.01% - 10.50% 118 318.66 34 85.28 - - - - 403.94
10.51%-11.00% 12 27.83 4 7.40 - - - - 35.23
13.51% - 14.00% 14 8.79 - - - - - - 8.79
Accrued Interest 1.63
EIR Impact -1.62
Total 200 456.23 57 105.80 - - - - 562.04

15 LEASE LIABILITIES

As at As at
March 31, 2024 March 31, 2023
Lease liabilities 23.63 24.29
23.63 24.29

16 OTHER FINANCIAL LIABILITIES

As at As at
March 31, 2024 March 31, 2023
At amortised cost
Employee benefit payable 5.42 2.90
Expenses payable 19.02 12.07
Payables on purchase of property, plant and equipment 0.94 0.61
Other financial liabilities 30.04 0.49
55.42 16.07

17 PROVISIONS

As at As at
March 31, 2024 March 31, 2023
Provision for employee benefits
Provision for gratuity 9.25 6.78
Provision for compensated absences 3.98 3.42
Provision for bonus 17.04 12.46
Other provisions
Provision for dividend on CCPS 0.02 0.01
Provision for rent straight lining - -
30.29 22.67

Aye Finance Private Limited 113

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

18 OTHER NON-FINANCIAL LIABILITIES

As at As at
March 31, 2024 March 31, 2023
Statutory dues payable 11.85 6.30
EMI and interest received in advance from customers (including Pre EMI) 10.47 6.02
Goods and service tax payable 2.81 -
Others 0.33 -
25.46 12.32

19 EQUITY SHARE CAPITAL

As at As at
March 31, 2024 March 31, 2023
Authorised
67,30,000 (March 31, 2023: 55,00,000 Shares) Equity shares of ` 10 each
6.73 5.50
with voting rights
2,91,00,000 (March 31, 2023: 2,91,00,000 Shares) Compulsorily
29.10 29.10
Convertible Cumulative Preference shares (CCPS) of ` 10 each
47,40,000 (March 31, 2023: NIL Shares) Compulsorily Convertible
9.48 -
Cumulative Preference shares (CCPS) of ` 20 each
45.31 34.60
Issued, subscribed and paid-up
48,30,520 (March 31, 2023: 48,30,500 Shares)
4.83 4.83
Equity shares of ` 10 each with voting rights
Less: amount recoverable from ESOP Trust (face value of 5,60,294 shares
-0.56 -0.56
of ` 10 each held by trust) (March 31, 2023: 5,60,294)
26,182,448 (March 31, 2023: 2,61,82,448 Shares) 0.01% Compulsorily
26.18 26.18
Convertible Cumulative Preference Shares (CCPS) of ` 10 each
47,39,244 (March 31, 2023: Nil Shares) 0.01% Compulsorily Convertible
9.48 -
Cumulative Preference Shares (CCPS) of ` 20 each
39.93 30.45

Details of shares held by promoters **

As at March 31, 2024

S. No. Promoter name No. of % of total % of total
shares shares shares
Nil Nil Nil Nil Nil

As at March 31, 2023

S. No. Promoter name No. of % of total % of total
shares shares shares
Nil Nil Nil Nil Nil

** Disclosure is given as per annual return filed under section 92 of the Companies Act, 2013 for the year ending
March 31 ,2023.

114 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

19.1 Reconciliation of the number of equity shares and amount outstanding at the beginning and at the end of the reporting
period:
Particulars Opening balance Fresh issue Closing balance
As at March 31, 2024
Equity shares with voting rights
No. of shares 48,30,500 20 48,30,520
Amount 4.83 0.00 4.83
0.01% Compulsorily Convertible Cumulative
Preference Shares (CCPS) of ` 10 each
No. of shares 2,61,82,448 - 2,61,82,448
Amount 26.18 - 26.18
0.01% Compulsorily Convertible Cumulative
Preference Shares (CCPS) of ` 20 each
No. of shares - 47,39,244.00 47,39,244
Amount - 9.48 9.48
As at March 31, 2023
Equity shares with voting rights
No. of shares 48,30,500 - 48,30,500
Amount 4.83 - 4.83
0.01% Compulsorily Convertible Cumulative
Preference Shares (CCPS) of ` 10 each
No. of shares 2,61,82,448 - 2,61,82,448
Amount 26.18 - 26.18

19.2 Terms, rights, preferences and restrictions attached to shares:

The Company has only one class of equity shares having par value of ` 10 per share. Each holder of Equity shares is
entitled to one vote per share. In the event of liquidation, the equity shareholders are eligible to receive the remaining
assets of the Company after distribution of all preferential amounts, in proportion of their shareholding.

19.3 As on March 31, 2024, the Company has 2,068,764 0.01% CCPS and 200 equity shares of ` 10 each fully paid up at
premium of ` 19.00 per share. These shares have been allotted between Elevation Capital V Limited and Accion Africa
- Asia Investment Company in equal proportion. (Series A)

19.4 As on March 31, 2024, the Company has 2,935,726 0.01% CCPS of ` 10 each fully paid up at premium of ` 58.13
per CCPS. These shares have been allotted between Elevation Capital V Limited and Accion Africa - Asia Investment
Company in equal proportion. (Series A1)

19.5 As on March 31, 2024, the Company has 6,556,360 0.01% CCPS of ` 10 each and 100 equity shares of ` 10 each fully
paid up at premium of ` 96.76 per share. These shares have been allotted between Elevation Capital V Limited and
Accion Africa - Asia Investment Company and LGT Capital Invest Mauritius PCC with Cell E/VP. (Series B)

19.6 As on March 31, 2024, the Company has 5,736,709 0.01% CCPS of ` 10 each and 100 equity shares of ` 10 each fully
paid up at premium of ` 246.24 per share. These shares have been allotted between Elevation Capital V Limited, LGT
Capital Invest Mauritius PCC with Cell E/VP and CapitalG LP. (Series C)

19.7 As on March 31, 2024, the Company has 54,75,089 0.01% CCPS of ` 10 each and 100 equity shares of ` 10 each fully
paid up at premium of ` 416.70 per share. These shares have been allotted between LGT Capital Invest Mauritius PCC
with Cell E/VP, CapitalG LP, Alpha Wave India I LP (formerly known as Falcon Edge India I LP) and MAJ Invest Financial
Inclusion Fund II K/S. (Series D)

Aye Finance Private Limited 115

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

19.8 As on March 31, 2024, the Company has 34,09,800 0.01% CCPS of ` 10 each fully paid up at premium of ` 605.87 per
CCPS. These shares have been allotted between LGT Capital Invest Mauritius PCC with Cell E/VP, CapitalG International
LLC, Alpha Wave India I LP (formerly known as Falcon Edge India I LP), A91 Emerging Fund I LLP and MAJ Invest
Financial Inclusion Fund II K/S. (Series E)

19.9 As on March 31, 2024, the Company has 47,39,244 0.01% CCPS of ` 20 each and 20 equity shares of ` 10 each fully
paid up at premium of ` 634.11 per share. These shares have been allotted between A91 Emerging Fund I LLP, British
International Investment plc and Waterfield Alternative Investments Fund I (Series F)

19.10 The Series A, A1, B, C, D, E and F CCPS shall be convertible into equity Shares of the Company in accordance with
the Schedule 7 of the Series F Shareholders Agreement dated December 06, 2023 executed by the Company with
Elevation Capital V Limited, A91 Emerging Fund I LLP, LGT Capital Invest Mauritius PCC with Cell E/VP, CapitalG LP,
CapitalG International LLC, Alpha Wave India I LP, MAJ Invest Financial Inclusion Fund II K/S, British International
Investment plc and Waterfield Alternative Investments Fund I.

Further the holders of Series A, A1, B, C, D, E and F CCPS may convert the CCPS in whole or part into equity shares at
any time before 19 (Nineteen) years from the date of issuance of the same.

19.11 D
 etails of equity shares held by each shareholder holding more than 5% shares in the Company:

Particulars As at As at
March 31, 2024 March 31, 2023
Number of % Number of %
shares held shares held
Equity shares with voting rights
Sanjay Sharma 9,79,750 20.28% 9,79,750 20.28%
Shankh Corporation LLP 8,49,625 17.59% 8,49,625 17.59%
Shvet Corporation LLP 8,49,625 17.59% 8,49,625 17.59%
Vikram Jetley 5,78,000 11.97% 6,31,000 13.06%
Aye Finance Employee Welfare Trust 5,60,294 11.60% 5,60,294 11.60%
Namrata Sharma 2,61,965 5.42% 2,61,965 5.42%
0.01% Compulsorily Convertible Cumulative Preference
shares
Elevation Capital V Limited 61,59,852 19.92% 61,59,852 23.53%
LGT Capital Invest Mauritius PCC with Cell E/VP 53,90,925 17.43% 53,90,925 20.59%
CapitalG LP 39,37,237 12.73% 39,37,237 15.04%
MAJ Invest Financial Inclusion Fund II K/S 22,04,985 7.13% 22,04,985 8.42%
Alpha Wave India I LP (Formerly known as Falcon Edge 41,31,987 13.36% 41,31,987 15.78%
India I LP)
A91 Emerging Fund I LLP 35,82,764 11.59% 32,00,565 12.22%
British International Investment plc 38,21,977 12.36% - -

19.12 Number of shares reserved for share options

Particulars As at As at
March 31, 2024 March 31, 2023
Equity shares of ` 10 fully paid up
Number of shares reserved for ESOPs 12,79,933 8,50,968

19.13 Number of shares reserved for warrants

Particulars As at As at
March 31, 2024 March 31, 2023
Equity shares of ` 1 fully paid up
Number of shares reserved for warrants 9,49,376 -

116 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

19.14 Shares allotted as fully paid-up without payment being received in cash / by way of bonus shares
 he Company have not issued bonus shares or shares for consideration other than cash during the five year period
T
immediately preceding the reporting date.

19.15 Shares bought back

C
 ompany have not bought back any of its securities during the five year period immediately preceding the reporting
date.

20 OTHER EQUITY

As at As at
March 31, 2024 March 31, 2023
Securities premium
Opening balance 659.34 659.34
Add: Premium on shares issued during the period 292.61 -
Closing balance 951.95 659.34
Amount received from issue of share warrants 0.09 -
Share option outstanding account
Opening balance 17.21 11.50
Add: Deferred stock compensation expense 4.70 5.71
Less: Utilisation of deferred stock compensation expense - -
Closing balance 21.91 17.21
Money received against share warrants
Statutory reserve
Opening balance 26.13 15.13
Add: Amount transferred from surplus of profit and loss 32.23 11.00
Closing balance 58.36 26.13
Retained earnings - other than remeasurement of post employment benefit
obligation
Opening balance 31.86 (10.93)
Add: Profit for the year 161.13 53.79
Less: Transfer to statutory Reserve (32.23) (11.00)
Closing balance 160.76 31.86
Retained earnings - remeasurement of post employment benefit obligation
Opening balance 3.51 0.52
Add: Comprehensive income for the year (0.41) 2.99
Closing balance 3.10 3.51
Total 1,196.18 738.05

Nature and purpose of reserves

Statutory reserves
The reserve is created as per the provision of Section 45(IC) of Reserve Bank of India Act, 1934. This is a restricted
reserve and no appropriation can be made from this reserve fund except for the purpose as may be prescribed by
Reserve Bank of India.

Securities premium reserves

Securities premium reserve is used to record the premium on issue of shares. The reserve can be utilised only for
limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013, and
during the year such expenses amounting to the tune of ` 7.84 crore have been utilised.

Aye Finance Private Limited 117

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Employee stock outstanding account

In accordance with resolution approved by the shareholders, the Company has reserved shares options, for issuance
to the eligible employees through ESOP scheme. The Company has approved stock option scheme on September
11, 2018 as amended from time to time. The Administrator (i.e. Nomination and Remuneration Committee (‘NRC’) of
the Company’s board of directors) has the power to grant the options in pursuance to the ESOP scheme, each option
consist of one equity share. Such option vest at a definite date, save for specific incidents, prescribed in the schemes
as framed/ approved by the Company. Such options are exercisable for a period following vesting at the discretion of
the NRC, subject to the conditions prescribed in the ESOP scheme as amended from time to time.

Retained earnings - other than remeasurement of post employment benefit obligation

Retained earnings or accumulated surplus represents total of all profits retained since Company’s inception. Retained
earnings are credited with current year profits, reduced by losses, if any, dividend payouts, transfers to General reserve
or any such other appropriations to specific reserves.

Retained earnings - remeasurement of post employment benefit obligation

Remeasurement of the net defined benefit liabilities comprise actuarial gain or loss.

21 INTEREST INCOME

For the year ended For the year ended

March 31, 2024 March 31, 2023
On Financial Assets measured at amortised cost
Interest on loans to customers 932.23 555.73
Interest on deposits with banks 16.46 10.76
948.69 566.49

22 NET GAIN/(LOSS) ON DERECOGNITION OF FINANCIAL INSTRUMENTS UNDER AMORTISED COST CATEGORY

For the year ended For the year ended

March 31, 2024 March 31, 2023
Net gain on derecognition of financial instruments under amortised cost
18.95 12.51
category
18.95 12.51

23 FEES AND COMMISSION INCOME

For the year ended For the year ended

March 31, 2024 March 31, 2023
Servicing fee 3.59 0.57
Application fee 13.24 9.89
Delay payment charges, registration charges, cheque dishonour charges etc. 31.03 15.02
47.86 25.48

24 NET GAIN ON FAIR VALUE CHANGES

For the year ended For the year ended

March 31, 2024 March 31, 2023
Investments
Gain on sale of mutual funds 21.01 11.99
Gain on currency fluctuation 3.71 6.96
24.72 18.95
Realised gain 26.99 11.65
Unrealised (loss) / gain -2.27 7.30
24.72 18.95

118 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

25 OTHER INCOME

For the year ended For the year ended

March 31, 2024 March 31, 2023
Miscellaneous income 31.26 19.91
Profit on early termination of lease 0.26 -
Profit on sale of assets 0.01 -
31.53 19.91

26 FINANCE COST

For the year ended For the year ended

March 31, 2024 March 31, 2023
Interest on:
Debt securities 113.24 102.46
Borrowings (other than debt securities) 193.24 81.59
Lease liabilities 2.21 3.16
Delayed payment of statutory dues - 0.01
Other finance cost 17.84 10.74
326.53 197.96

* Borrowing cost includes interest expense calculated using the EIR method.

27 NET LOSS ON FAIR VALUE CHANGES

For the year ended For the year ended

March 31, 2024 March 31, 2023
Loss on fair value of cross currency swap 6.18 6.57
6.18 6.57

28 IMPAIRMENT ON FINANCIAL INSTRUMENTS

For the year ended For the year ended

March 31, 2024 March 31, 2023
Measured at amortised cost
Impairment on financial instruments at amortised cost 76.80 20.85
Amounts written off (net of recovery) 52.92 50.00
Loss on settlement 1.68 2.50
131.40 73.35

29 EMPLOYEE BENEFITS EXPENSE

For the year ended For the year ended

March 31, 2024 March 31, 2023
Salaries and wages 225.20 174.35
Contribution to provident and other funds 17.61 15.27
Expense on employee stock option (ESOP) scheme [Refer note 39] 4.70 5.70
Staff welfare expenses 24.99 14.49
Gratuity expenses 2.71 2.39
275.21 212.20

Aye Finance Private Limited 119

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

30 OTHER EXPENSES

For the year ended For the year ended

March 31, 2024 March 31, 2023
Rent - 0.08
Rates and taxes 2.56 1.22
Communication costs 6.31 4.85
Printing and stationery 2.39 1.92
Professional services 8.43 9.86
Credit charges 4.40 -
Outsourcing charges 0.92 -
Legal and technical charges 1.64 -
Directors fees 0.35 0.25
Payment to auditors [Refer Note below] 1.05 1.27
Corporate social responsibility (CSR) 0.94 0.53
Membership and subscription fees 12.11 9.87
Travel and conveyance 29.38 24.09
Tour and travelling 6.82 5.19
Electricity expenses 1.49 1.05
Office expenses 6.10 5.34
CGTMSE premium charge - 2.25
Bank charges 2.30 1.17
Seminars, conferences and events 0.32 -
Collection charges 2.17 -
Loss on sale of property, plant and equipment's 0.06 -
Provision on investments 0.25 -
Miscellaneous expenses 0.04 1.47
90.03 70.41
Note : Payment to auditors **
Statutory audit 0.47 0.68
Limited review 0.30 0.41
Tax audit 0.05 0.07
Other certifications 0.18 0.06
Out of Pocket Expense 0.05 0.05
1.05 1.27

** Current year’s amount is inclusive of ` 0.46 crore paid to the erstwhile Statutory Auditors i.e. SR Batliboi & Associates
LLP

(it includes Tax Audit, Limited Review, Certifiations & Out of Pocket Expenses)

31 DISCLOSURE PERTAINING TO CORPORATE SOCIAL RESPONSIBILITY EXPENSES

Particulars As at As at
March 31, 2024 March 31, 2023
Amount required to be spent by the Company during the year 0.18 0.50
Amount spent during the year ending on March 31, 2024
(a) Construction/acquisition of any asset - -
(b) On purposes other than (i) above** 0.94 0.53
(c) Shortfall/(excess) at the end of the year Nil Nil

120 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Particulars As at As at
March 31, 2024 March 31, 2023
(d) Total of Previous year shortfall Nil Nil
(e) Reason for shortfall NA NA
(f) Where a provision is made with respect to liability incurred by entering
NA NA
into a contractual obligation, the movements in the provision.

** For the purpose of Dairy program, Footwear Program, Sports Program, Kirana program, Women Empowerment etc.
Note: 1 Details of related party transactions in relation to CSR expenditure as per Ind AS 24, Related Party Disclosures
(refer note no 36).
Note: 2 The Company has undertaken CSR Activities as per schedule VII of the Companies Act, 2013.

32 EARNINGS PER SHARE

Basic EPS amounts is calculated by dividing the profit for the year attributable to equity holders by the weighted average
number of equity shares outstanding during the year. Diluted earnings per share is computed using the weighted
average number of common and dilutive common equivalent shares outstanding during the year, except where the
result would be anti-dilutive.

Particulars For the year ended For the year ended

March 31, 2024 March 31, 2023
Profit / (Loss) attributable to equity holders 161.13 53.79
Less: Preference dividend - -
Net Profit / (Loss) attributable to equity holders 161.13 53.79
Weighted average number of equity shares outstanding during the year -
3,23,27,246 3,10,12,948
for Basic EPS
Effect of dilutive potential equity share equivalent 3,62,599 3,91,080
Weighted average number of equity shares outstanding during the year -
3,26,89,845 3,14,04,028
for Dilutive EPS
Basic earnings per share (`) 49.84 17.34
Diluted earnings per share (`) 49.29 17.13
Nominal value per share (`) 10.00 10.00

33 CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

Particulars As at As at
March 31, 2024 March 31, 2023
(a) Commitments
Estimated amount of contracts remaining to be executed on capital
- -
account and not provided for
Commitments related to loans sanctioned but not disbursed 38.20 16.66

(b) During the previous year, the Company has received a demand for income tax under Income Tax Act, 1961 for
rupees 2.44 crore for the assessment year 2017-18. The order is disputed by the Company and the Company had
filed an appeal before Commissioner of Income Tax Appeals and has deposited rupees 0.48 crore as demand
against protest. Based on the opinion received from the Company’s consultant, the Company believes that the
likelihood of materialising the liability may arise.

Aye Finance Private Limited 121

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

34 SEGMENT INFORMATION

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating
Decision Maker (CODM). The CODM makes strategic decisions and is responsible for allocating resources and
assessing performance of the operating segments.

The CODM considers the entire business of the Company on a holistic basis to make operating decisions reviews the
operating results of the Company as a whole. Further the Company operates in a single reportable segment i.e. granting
loans, which has similar risks and returns for the purpose of Ind AS 108 “Operating segments”, and is considered to
be the only reportable business segment. Further, the Company is operating in India which is considered as a single
geographical segment.

35 EMPLOYEE BENEFITS

35.1 Defined contribution plans

The Company makes Provident Fund to defined contribution plan for qualifying employees. Under the Schemes, the
Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company
recognised rupees 17.61 crore (March 31, 2023: rupees 15.27 crore) for Provident Fund contributions in the statement
of profit and loss. The contributions payable to these plans by the Company are at rates specified in the rules of the
schemes.

35.2 Other long-term benefits

The Company has a defined benefit leave encashment plan for its employees. Under this plan, they are entitled to
encashment of earned leaves subject to certain limits and other conditions specified for the same. The liabilities
towards leave encashment have been provided on the basis of actuarial valuation. The Company recognised rupees
4.68 crore (March 31, 2023: rupees 3.14 crore) for compensated absences in the statement of profit and loss.

35.3 Defined benefit plans

The Company’s gratuity scheme provide for lump sum payment to vested employees at retirement, death while in
employment or on termination of employment of an amount equivalent to 15 days basic salary for each completed
year of service or part thereof in excess of six months in terms of provisions of Gratuity Act, 1972. Vesting occurs upon
completion of five years of service.

The present value of defined benefit obligation and the related current service cost were measured using the projected
unit credit method with actuarial valuations being carried out at each balance sheet date.

The following table summarises the components of net benefit expense recognised in the statement of profit and loss
and the amounts recognised in the balance sheet:

(a) Amount recognised in the statement of profit and loss and other comprehensive income:

Particulars As at As at
March 31, 2024 March 31, 2023
Current service cost 2.21 1.72
Interest expense 0.50 0.67
Amount recognised in the statement of profit and loss 2.71 2.39
Remeasurement of defined benefit liability:
Actuarial (gain) / loss from changes in demographic assumptions - -3.32
Actuarial (gain) / loss from changes in financial assumptions 0.06 -0.21
Actuarial (gain) / loss from experience adjustments 0.50 -0.46
Amount recognised in other comprehensive income 0.56 -3.99
3.27 -1.60

122 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

(b) Reconciliation of fair value plan assets and defined benefit obligation
Particulars As at As at
March 31, 2024 March 31, 2023
Defined benefit obligation 9.25 6.78
Net defined (asset) / liability recognised in the balance sheet 9.25 6.78

(c) Actual contributions and benefit payments during the year

Particulars As at As at
March 31, 2024 March 31, 2023
Actual benefit payments -0.80 -0.86

(d) Changes in the present value of the defined benefit obligation are as follows:
Particulars As at As at
March 31, 2024 March 31, 2023
Defined benefit obligation at beginning of the year 6.78 9.24
Current service cost 2.21 1.72
Interest expense 0.50 0.67
Remeasurement (gains) / losses
Actuarial (gain) / loss from changes in financial assumptions 0.06 -0.21
Actuarial (gain) / loss from experience adjustments 0.50 -0.46
Actuarial (gain) / loss from changes in demographic assumptions - -3.32
Benefits paid -0.80 -0.86
Defined benefit obligation at end of the year 9.25 6.78

(e) Changes in the fair value of plan assets are as follows:

Particulars As at As at
March 31, 2024 March 31, 2023
Fair value of plan assets at beginning of the year - -
Fair value of plan assets at end of the year - -

35.4 The principal assumptions used in determining obligations for the Company’s plan are shown below:
Particulars As at As at
March 31, 2024 March 31, 2023
Discount rate (in %) 7.25% 7.39%
Future salary increase (in %) 10.00% 10.00%
Retirement age 58.00 58.00
Demographic assumptions
Attrition
Upton 30 years 33.10% 33.10%
31-44 years 28.40% 28.40%
Above 44 years 6.20% 6.20%
Mortality IALM (2012-14) IALM (2012-14)

The discount rate is based on the prevailing market yields of Government of India securities as at the balance sheet
date for the estimated term of obligations. The estimate of future salary increases considered, takes into account the
inflation, seniority, promotion, increments and other relevant factors.

Aye Finance Private Limited 123

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Sensitivity analysis
Significant actuarial assumptions for the determination of the defined obligation are discount rate, expected salary
increase and mortality. The sensitivity analyses below have been determined based on reasonably possible changes of
the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

Particulars As at As at
March 31, 2024 March 31, 2023
Present value of obligation at the end of the period 9.25 6.78
Effect of +50 basis points in rate of discounting -0.22 -0.16
Effect of -50 basis points in rate of discounting 0.23 0.17
Present value of obligation at the end of the period 9.25 6.78
Effect of +50 basis points in rate of salary increase 0.20 0.16
Effect of -50 basis points in rate of salary increase -0.20 -0.15

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation
as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions
may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been
calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied
in calculating the defined benefit obligation liability recognised in the balance sheet.

There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.

Experience adjustments Present value of Fair value of Estimated gain/ (loss) Estimated gain/ (loss)
defined benefit plan assets adjustments on plan adjustments on plan
obligation liabilities assets
2023-24 9.25 - 0.50 -
2022-23 6.78 - -0.46 -
2021-22 9.24 - -1.15 -
2020-21 7.45 - 0.34 -
2019-20 4.49 - -0.11 -
2018-19 1.99 - 0.00 -
2017-18 0.80 - -0.00 -
2016-17 0.37 - 0.02 -

35.5 Risk exposure:

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are
detailed below:

Interest risk: The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an
increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability
(as shown in financial statements).

Liquidity risk: This is the risk that the Company is not able to meet the short-term / long term gratuity pay-outs. This
may arise due to non availability of enough cash / cash equivalent to meet the liabilities or holding of illiquid assets not
being sold in time.

Salary Escalation risk: The present value of the defined benefit plan is calculated with the assumption of salary increase
rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from the rate
of increase in salary used to determine the present value of obligation will have a bearing on the plan’s liability.

Demographic risk: The Company has used certain mortality and attrition assumptions in valuation of the liability. The
Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.

124 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Regulatory risk: Gratuity benefit is paid in accordance with the requirements of the Payment of Gratuity Act, 1972
(as amended from time to time). There is a risk of change in regulations requiring higher gratuity pay-outs (e.g. Increase
in the maximum limit on gratuity of ` 0.2 crore).

36 RELATED PARTY DISCLOSURES

Disclosures in accordance with the requirements of Ind AS 24 on Related Party Disclosures, as identified and certified
by the management, are set out as below:

36.1 Details of related parties:

Description of relationship Names of related parties
Key Managerial Personnel (KMP) Mr. Sanjay Sharma - Managing Director
Mr. Mayank Shyam Thatte - Chief Financial Officer (up to May 24, 2023)
Mr. Krishan Gopal - Chief Financial Officer (w.e.f. July 07, 2023)
Ms. Tripti Pandey - Company Secretary, Compliance Officer & CCO
Independent directors Mr. Navin Kumar Maini (up to September 02, 2023)
Mr. Vinay Baijal (up to September 02, 2023)
Ms. Arpita Pal Agrawal (up to September 02, 2023)
"Mr. Govinda Rajulu Chintala (w.e.f. September 01, 2023)
(Appointed as Chairperson of Board w.e.f. January 5, 2024)"
Mr. Sanjaya Gupta (w.e.f. September 01, 2023)
Ms. Kanika Tandon Bhal (w.e.f. September 01, 2023)
Non-Executive, Non-Independent Mr. Vivek Kumar Mathur
Directors
Mr. Navroz Darius Udwadia
Mr. Kartik Srivatsa
Mr. Kaushik Anand Kalyana Krishnan
Entities over which KMP's have Aye Finance Employee Welfare Trust
significant influence
Shankh Corporation LLP
Shvet Corporation LLP
Entities exercising significant Elevation Capital V Limited (formerly known as SAIF Partners India V Ltd.)
influence
Alpha Wave India I LP (formerly known as Falcon Edge India I LP )
A91 Emerging Fund I LLP
LGT Capital Invest Mauritius PCC with Cell E/VP
CapitalG LP
CapitalG International LLC
British International Investment PLC w.e.f. January 05, 2024
Wholly - owned subsidiary company Foundation for Advancement of Micro Enterprises (Section 8 Company)
Relatives of KMP Ms. Namrata Sharma
Mr. Shashwat Sharma

Aye Finance Private Limited 125

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

36.2 Details of related party transactions during the year ended March 31, 2024 and outstanding balance as at March 31,
2024:
Particulars As at As at
March 31, 2024 March 31, 2023
(a) Managerial remuneration
Short term employee benefits (Director) 3.69 3.00
Short term employee benefits (Relative of Director) 0.12 0.05
Short term employee benefits (KMP other than directors) 1.52 3.50
Post employment benefits - -
Other long-term benefits - -
Termination benefits - -
Share based payments - -
(i) Excluding provision for gratuity and compensated absences as
the same are actuarially determined for the Company as a whole
and thus not separately
(ii) The above detail doesn't include employees stock options plan
cost charged in profit and loss account

(b) Director’s sitting fee 0.35 0.25

(c) Grant of ESOPs (KMP) 0.34 0.01

(d) Corporate social responsibility

Particulars As at As at
March 31, 2024 March 31, 2023
Foundation for Advancement of Micro Enterprises (FAME) 0.94 0.50
0.94 0.50

(e) Balance outstanding at the end of the year

(e) (i) Long term loans and advances
Particulars As at As at
March 31, 2024 March 31, 2023
Aye Finance Employee Welfare Trust 0.13 0.13
0.13 0.13

(e) (ii) Investment in subsidiary company

Particulars As at As at
March 31, 2024 March 31, 2023
Foundation for Advancement of Micro Enterprises (FAME) - 0.25
- 0.25

(e) (iii) Equity shares outstanding

Particulars As at As at
March 31, 2024 March 31, 2023
Directors
Mr. Sanjay Sharma 0.98 0.98
Relative of Directors
Ms. Namrata Sharma 0.26 0.26

126 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Particulars As at As at
March 31, 2024 March 31, 2023
Entities over which KMP's have significant influence
Shvet Corporation LLP 0.85 0.85
Shankh Corporation LLP 0.85 0.85
Entities exercising significant influence over the Company
Alpha Wave India I LP (formerly known as Falcon Edge India I LP ) 0.17 0.17
Elevation Capital V Limited 0.05 0.05
A91 Emerging Fund I LLP 0.00 0.00
LGT Capital Invest Mauritius PCC with Cell E/VP 0.03 0.03
CapitalG LP 0.00 0.00
British International Investment PLC 0.00 -
Aye Finance Employee Welfare Trust 0.56 0.56
3.75 3.75

(f) Loans and advances in nature of loans are granted to promoters, directors, KMPs and the related parties (as
defined under the Companies Act, 2013), either severally or jointly with any other person that are (a) repayable on
demand or (b) without specifying any terms or period of repayment

Type of borrower Amount of loan or advance in nature Percentage to the total loans and
of loan outstanding advances in the nature of loans
Nil Nil Nil

(g) All the related party transactions that were entered during the financial year were in the ordinary course of business
and on an arm’s length basis. There were no materially significant transactions made by the Company with the
related parties either individually or taken together with the previous transactions which may have a potential
conflict with the interest of the Company at large. All the related party transactions are placed before the Audit
Committee and subsequently before the Board of Directors for approval and review on quarterly basis.

37 INTANGIBLE ASSET UNDER DEVELOPMENT

Particulars As at As at
March 31, 2024 March 31, 2023
Intangible asset under development 2.95 0.47
2.95 0.47

37.1 (a) Intangible asset under development ageing schedule

As at March 31, 2024

Intangible asset under development Amount of CWIP for a period of Total
Less than 1 year 1 - 2 year 2 - 3 year More than 3 years
Projects in progress
Product Development App** 0.25 - - - 0.25
ML APP * 2.70 - - - 2.70
2.95 - - - 2.95

Aye Finance Private Limited 127

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

As at March 31, 2023

Intangible asset under development Amount of CWIP for a period of Total
Less than 1 year 1 - 2 year 2 - 3 year More than 3 years
Projects in progress
Mobile App 0.41 0.06 - - 0.47
0.41 0.06 - - 0.47

*Project in progress is related with implementation of new workflow related to Mortgage loan and its expected
completion date is 1st July 2024.

**Project in progress is related with implementation of new workflow related to Product Development App and its
expected completion date is February 2025.

37.1 (b) Movement of Intangible asset under development

Particulars Mobile App Product Development App ML APP Total
Amount as at April 01, 2022 0.06 - - 0.06
Additions During the year 0.41 - - 0.41
Less: Amount capitalised in Intangible
- - - -
assets
Balance as at March 31, 2023 0.47 - - 0.47
Amount as at April 01,2023 0.47 - - 0.47
Additions During the year 0.23 0.25 2.70 3.18
Less: Amount capitalised in Intangible
0.70 - - 0.70
assets
Balance as at March 31, 2024 - 0.25 2.70 2.95
- 0.25 2.70 2.95

37.2 Intangible asset under development Completion schedule

There is no intangible asset under development for which completion is overdue or has exceeded its cost compared to
its original plan in the Company.

38 RATIO ANALYSIS AND IT’S ELEMENTS**

Particulars As at As at % Variance Reason for

March 31, 2024 March 31, 2023 Variance
(if above 25%)
(a) Capital to risk -weighted
32.79% 31.07% 5.52% Not applicable
assets ratio (CRAR)
(b) Tier I CRAR 32.79% 31.07% 5.52% Not applicable
(c) Tier II CRAR 0.00% 0.00% 0.00% Not applicable
(d) Liquidity coverage ratio Not applicable Not applicable Not applicable Not applicable

** Based on the requirement of the Schedule III

39 EMPLOYEE SHARE BASED PAYMENTS

The Company at its Extra Ordinary General Meeting held on November 29, 2016 had approved an Employee Stock Option
Plan 2016 (‘the Plan’) and had authorised the Company to issue stock options under the above plan. The Company
has provided loan to Aye Finance Employee Welfare Trust for purchase of 5,60,294 Equity shares (ESOP Shares) from
the existing shareholders. In October 2020 the ESOP plan 2016 was discontinued and balance 155,751 shares of ESOP
pool were transferred to a new ESOP plan. In financial year 2020, the Company approved a new employee stock option
plan 2020 (‘the ESOP 2020 Plan’) and authorised the Company to issue stock options under the above plan. The

128 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Company has provided loans to Aye Finance Employee Welfare Trust for purchase of 632,918 Equity shares from the
existing shareholder. The vesting period for the options in both ESOP 2016 Plan and ESOP 2020 Plan is 4 years (with
10%, 20%, 30% and 40% annual vesting under the ESOP 2016 Plan and 25% annual vesting under the ESOP 2020 Plan)
commencing from the date of grant of options. It is the intention of the Company that the options would be exercised
at the time of the listing of the shares pursuant to the liquidity event as defined in the ESOP scheme. During the year,
the Company had granted 1,85,990 options on July 02,2023 and 3,01,645 options on January 02, 2024 (During previous
year, the Company had granted 218,160 options on July 02,2022 and 4,340 options on January 02, 2023). Fair valuation
has been carried at the grant date using the Black-Scholes model. The shares of the Company are not listed on any
stock exchange. Accordingly, the expected median volatility for listed peer group has been considered.

Employee stock options details as on the balance sheet date are as follows:

As at March 31, 2024

Grant date ESOP Exercise Outstanding at Options Options Options Options Option
plan price the beginning granted / vested and unvested lapsed outstanding
(` per option) of the year Adjustments exercisable
January 02, 2017 2016 29.00 1,09,076.00 - - - 4,816.70 1,04,259.30
June 02, 2017 2016 29.00 5,307.00 - - - 225.30 5,081.70
January 02, 2018 2016 29.00 23,855.00 - - - 424.98 23,430.02
July 02, 2018 2016 29.00 3,851.00 - - - 1,264.60 2,586.40
July 02, 2019 2016 29.00 1,98,564.00 - - - 38,558.70 1,60,005.30
July 02, 2020 2016 29.00 6,823.00 - - - 2,046.90 4,776.10
January 02, 2021 2020 615.87 1,85,857.00 - - - 7,210.50 1,78,646.50
July 02, 2021 2020 615.87 16,635.00 - - - - 16,635.00
January 02, 2022 2020 615.87 94,900.00 27,127.50 - - 11,127.50 1,10,900.00
July 02, 2022 2020 615.87 2,01,760.00 - - - 15,332.50 1,86,427.50
January 02, 2023 2020 615.87 4,340.00 - - - 840.00 3,500.00
July 02, 2023 2020 615.87 - 1,85,990.00 - - 3,950.00 1,82,040.00
January 02, 2024 2020 615.87 - 3,01,645.00 - - - 3,01,645.00

As at March 31, 2023

Grant date ESOP Exercise Outstanding Options Options Options Options Option
plan price at granted / vested and unvested lapsed outstanding
(`per option) the beginning Adjustments exercisable
of the year
January 02, 2017 2016 29.00 1,09,076.00 - - - - 1,09,076.00
June 02, 2017 2016 29.00 5,306.70 - - - - 5,307.00
January 02, 2018 2016 29.00 23,855.00 - - - - 23,855.00
July 02, 2018 2016 29.00 3,851.00 - - - - 3,851.00
July 02, 2019 2016 29.00 2,03,635.00 - - - 5,071.00 1,98,564.00
July 02, 2020 2016 29.00 6,823.00 - - - - 6,823.00
January 02, 2021 2020 615.87 1,96,420.00 - - - 10,563.00 1,85,857.00
July 02, 2021 2020 615.87 - 16,635.00 - - - 16,635.00
January 02, 2022 2020 615.87 1,18,954.00 - - - 24,054.00 94,900.00
July 02, 2022 2020 615.87 - 2,18,160.00 - - 16,400.00 2,01,760.00
January 02, 2023 2020 615.87 - 4,340.00 - - - 4,340.00

Aye Finance Private Limited 129

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Weighted average fair value of stock options granted during the year is as follows:
Particulars As at As at
March 31, 2024 March 31, 2023
Grant date 02-Jul-23 02-Jan-24 02-Jul-22
Number of options granted 1,85,990 3,01,645 2,18,160
Weighted average fair value (`) 247.26 239.78 325.94

Method used for accounting for share based payment plan

The Company has used the fair value method to account for the compensation cost of stock options to employees. The
fair value of options used are estimated on the date of grant using the Black – Scholes Model. The key assumptions
used in Black – Scholes Model for calculating fair value as on the date of respective grants are:
Grant date Risk free Expected life Expected Dividend Fair value of the Conversion
interest rate volatility* yield underlying share Ratio
in the market at the
time of the option
grant (`)
January 02, 2017 4.89% 4 Years 41.97% 0.00% 72.00 1:01
June 02, 2017 4.89% 4 Years 41.97% 0.00% 72.00 1:01
January 02, 2018 4.89% 4 Years 41.97% 0.00% 111.43 1:01
July 02, 2018 4.89% 4 Years 41.97% 0.00% 256.24 1:01
July 02, 2019 4.89% 4 Years 41.97% 0.00% 447.37 1:01
July 02, 2020 4.89% 4 Years 41.97% 0.00% 615.87 1:01
January 02, 2021 5.04% 4 Years 42.44% 0.00% 615.87 1:01
July 02, 2021 5.66% 4.17 Years 50.06% 0.00% 615.87 1:01
January 02, 2022 5.66% 3 to 4 years 48.96% 0.00% 615.87 1:01
(3.75-years)
6.09%
(4-years)
July 02, 2022 7.00% 3.25 to 4 48.96% 0.00% 615.87 1:01
(3.25-years) years
7.11%
(4-years)
January 02, 2023 7.15% 3.12 years 46.71% 0.00% 693.00 1:01
July 02, 2023 6.99% 2.87 years 43.22% 0.00% 650.00 1:01
January 02, 2024 7.21% 2.75 years 41.94% 0.00% 654.11 1:01

*Shares are exercisable on the occurrence of a Liquidity Event which primarily is the listing of the shares of the Company
on a Stock Exchange via an Initial Public Offering.

**The share of the Company are not listed on any stock exchange accordingly, the expected median volatility for listed
peer group has been considered.

# FV of shares of the Company is the Fair Value of the shares of the Company as on the grant date.

40 INCOME TAXES

This note provides an analysis of the Company’s income tax expense, show amounts that are recognised directly in
equity and how the tax expense is affected by non-assessable and non-deductible items. It also explains significant
estimates made in relation to the Company’s tax positions.

130 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Particulars As at As at
March 31, 2024 March 31, 2023
Accounting profit before tax 227.86 71.40
(a) Income tax expense
Current tax
Current tax on profits for the year 70.63 -
Tax for earlier years 10.55 0.62
Total current tax (benefit) / expense 81.18 0.62
Deferred tax
Credit recognised in statement of profit and loss -14.45 16.99
Total deferred tax expense / (benefit) -14.45 16.99
Income tax expense recognised in the statement of profit and loss 66.73 17.61
Deferred tax relating to other comprehensive income 0.15 -1.00

(b) Reconciliation of tax expense and the accounting profit multiplied by India’s tax rate:
The tax charge shown in the statement of profit and loss differs from the tax charge that would apply if all profits
had been charged at India corporate tax rate. A reconciliation between the tax expense and the accounting profit
multiplied by India’s domestic tax rate for the years ended March 31, 2024 and March 31, 2023 is, as follows:

Particulars As at As at
March 31, 2024 March 31, 2023
Profit from continuing operations before income tax expense 227.86 71.40
Applicable tax rate 25.17% 25.17%
Computed tax (gain) / expense 57.35 17.97
Tax effect of :
Deductions Claimed / Expenses allowed under tax provisions -23.39 -0.98
Disallowance / Expenses not allowable 36.67 -
Deferred tax credit on temporary differences -14.45 -
Tax for earlier years 10.55 0.62
Income tax expense recognised in the statement of profit and loss 66.73 17.61
The effective income tax rate 29.28% 24.67%

(c) Deferred tax assets / liabilities

Components of deferred tax assets / As at Statement of Other Others As at
(liabilities) March 31, profit and loss comprehensive March 31,
2023 income 2024
Measurement of financial assets at
21.08 22.43 43.51
amortised cost
Measurement of financial liabilities at
-3.53 -1.09 -4.62
amortised cost
Difference in book balance of property,
plant and equipment as per the 1.01 -0.10 0.91
Companies Act and the Income Tax Act
Provision for gratuity and compensated
2.57 0.61 0.15 3.34
absences
Income tax losses 7.29 -7.29 -
Others 0.92 -0.10 0.82
29.34 14.46 0.15 - 43.95

Aye Finance Private Limited 131

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Components of deferred tax assets / As at Statement of Other Others As at

(liabilities) March 31, profit and loss comprehensive March 31,
2022 income 2023
Measurement of financial assets at
26.25 -5.17 21.08
amortised cost
Measurement of financial liabilities at
-3.47 -0.06 -3.53
amortised cost
Difference in book balance of property,
plant and equipment as per companies 0.70 0.31 1.01
act and Income tax act
Provision for gratuity and compensated
3.80 -0.23 -1.00 2.57
absences
Income tax losses 16.97 -9.68 7.29
Others 3.08 -2.16 0.92
47.33 -16.99 -1.00 - 29.34

41 The Company does not have any long term contracts including derivative contracts for which there are any material
foreseeable losses.

42 There are no amounts which were required to be transferred to the Investor Educational and Protection Fund by the
Company.

43 The Company does not have any year end unhedged foreign currency exposures.

44 STANDARDS ISSUED BUT NOT YET EFFECTIVE

There are neither new standards nor amendments to existing standards which has effect on the current financial
statements and are effective for the annual period beginning from April 01, 2024.

45 DISCLOSURES RELATING TO SECURITISATION

45.1 The information on securitisation of the Company as an originator in respect of

Sr. Particulars As at As at
No March 31, 2024 March 31, 2023
(a) Total number of transactions entered during the year 21.00 17.00
(b) Total number of loan assets 1,27,296.00 1,06,700.00
(c) Total book value of loan assets 1,336.30 850.35
(d) Sale consideration received 1,215.97 776.85

45.2 Disclosure pursuant to RBI notification - RBI/DOR/2021-22/85 DOR.STR.REC.53/21.04.177/2021-22 dated September

24, 2021: Details of securitisation transactions:

Sr. Particulars As at As at
No March 31, 2024 March 31, 2023
(a) No. of SPV's sponsored by NBFC for securitisation transactions 21.00 17.00
(b) Total amount of securitised assets as per books of SPVs sponsored
1,336.30 850.35
by the NBFC
(c) Total amount of exposures retained by the NBFC to comply with
MRR as on the date of balance sheet

132 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Sr. Particulars As at As at
No March 31, 2024 March 31, 2023
Off-balance sheet exposures
(i) First lossW - -
(ii) Others - -
On-balance sheet exposures
(i) First loss 147.45 77.45
(ii) Others (MRR including securitisation investments) 78.57 73.49
(d) Amount of exposures to securitisation transactions other than MRR
Off-balance sheet exposures
Exposure to own securitisation
(i) First loss - -
(ii) Loss - -
Exposure to third party securitisation
(i) First loss - -
(ii) Loss - -
On-balance sheet exposures
Exposure to own securitisation
(i) First loss - -
(ii) Loss - -
Exposure to third party securitisation
(i) First loss - -
(ii) Loss - -
(e) Sale consideration received for the securitised assets and gain/loss
1,215.97 776.85
on sale on account of securitisation
(f) Form and quantum (outstanding value) of services provided by way
- -
of, liquidity support, post-securitisation asset servicing, etc.
(g) Performance of facility provided:
Credit enhancement facility
Fixed deposit
(i) Amount paid 147.45 77.45
(ii) Repayment received - -
(iii) Outstanding amount 147.45 77.45
Corporate guarantee
(i) Amount paid - -
(ii) Repayment received - -
(iii) Outstanding amount - -
(h) Average default rate of portfolios observed in the past 1.03% 0.46%
(i) Amount and number of additional/top up loan given on same
- -
underlying asset
(j) Investor complaints
Directly / Indirectly received and; Nil Nil
Complaints outstanding Nil Nil

Aye Finance Private Limited 133

 46 DISCLOSURE ON RESTRUCTURING PURSUANT TO RESERVE BANK OF INDIA NOTIFICATION DNBS.CO.PD. NO. 367/03.10.01/2013-14 DATED JANUARY

134
23, 2014

46.1 For the year March 31, 2024

Sr. Type of Restructuring Under CDR Under SME Debt Others Total
No. Mechanism Restructuring
Mechanism

Asset Classification

Sub-
Sub-
Sub-

Loss
Loss
Loss
Loss

Total
Total
Total
Total

Sub-
Doubtful
Doubtful
Doubtful
Doubtful

Standard
Standard
Standard
Standard

Standard
Standard
Standard
Standard
Details
a Restructured accounts as on April
No of borrowers - - - - - - - - - - - 288.00 - - 288.00 - 288.00 - - 288.00
01 of the FY (opening figures)*
Amount Outstanding - - - - - - - - - - - 2.98 - - 2.98 - 2.98 - - 2.98
Provision thereon - - - - - - - - - - - 2.02 - - 2.02 - 2.02 - - 2.02
b Fresh restructuring during the year No of borrowers - - - - - - - - - - - 80.00 - - 80.00 - 80.00 - - 80.00
Amount Outstanding - - - - - - - - - - - 0.86 - - 0.86 - 0.86 - - 0.86
(All amounts are in ` crore unless otherwise stated)

Provision thereon - - - - - - - - - - - 0.61 - - 0.61 - 0.61 - - 0.61

c Upgradations to restructured
No of borrowers - - - - - - - - - - - - - - - - - - - -
standard category during the FY
Amount Outstanding - - - - - - - - - - - - - - - - - - - -
Provision thereon - - - - - - - - - - - - - - - - - - - -
d Restructured standard advances
which cease to attract higher
provisioning and / or additional
risk weight at the end of the FY No of borrowers - - - - - - - - - - - -33.00 - - -33.00 - -33.00 - - -33.00
and hence need not be shown as
restructured standard advances at
the beginning of the next FY
Amount Outstanding - - - - - - - - - - - -0.55 - - -0.55 - -0.55 - - -0.55
Provision thereon - - - - - - - - - - - -0.33 - - -0.33 - -0.33 - - -0.33
e Down gradations of restructured
No of borrowers - - - - - - - - - - - - - - - - - - - -
accounts during the FY
Amount Outstanding - - - - - - - - - - - - - - - - - - - -
Provision thereon - - - - - - - - - - - - - - - - - - - -
f Write-offs of restructured
No of borrowers - - - - - - - - - - - -73.00 - - -73.00 - -73.00 - - -73.00
accounts during the FY*
Amount Outstanding - - - - - - - - - - - -0.86 - - -0.86 - -0.86 - - -0.86
Provision thereon - - - - - - - - - - - -0.62 - - -0.62 - -0.62 - - -0.62
g Restructured accounts as on
March 31 of the FY (closing No of borrowers - - - - - - - - - - - 262.00 - - 262.00 - 262.00 - - 262.00
figures*)
Amount Outstanding - - - - - - - - - - - 2.43 - - 2.43 - 2.43 - - 2.43

Annual Report 2023-24

Provision thereon - - - - - - - - - - - 1.69 - - 1.69 - 1.69 - - 1.69
NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
 46.2 For the year March 31, 2023
Sr. Type of Restructuring Under CDR Under SME Debt Others Total
No. Mechanism Restructuring
Mechanism

Asset Classification

Sub-
Sub-
Sub-

Loss
Loss
Loss
Loss

Total
Total
Total
Total

Sub-
Doubtful
Doubtful
Doubtful
Doubtful

Standard
Standard
Standard
Standard

Standard
Standard
Standard
Standard
Details

Aye Finance Private Limited

a Restructured accounts as on April 01
No of borrowers - - - - - - - - - - 416.00 20.00 - - 436.00 416.00 20.00 - -
of the FY (opening figures)* 436.00
Amount
- - - - - - - - - - 4.31 0.22 - - 4.53 4.31 0.22 - - 4.53
Outstanding
Provision thereon - - - - - - - - - - 1.68 0.15 - - 1.82 1.68 0.15 - - 1.82
b Fresh restructuring during the year No of borrowers - - - - - - - - - - - 94.00 - - 94.00 - 94.00 - - 94.00
Amount
- - - - - - - - - - - 1.19 - - 1.19 - 1.19 - - 1.19
(All amounts are in ` crore unless otherwise stated)

Outstanding
Provision thereon - - - - - - - - - - - 0.79 - - 0.79 - 0.79 - - 0.79
c Upgradations to restructured
No of borrowers - - - - - - - - - - - - - - - - - - - -
standard category during the FY
Amount
- - - - - - - - - - - - - - - - - - - -
Outstanding
Provision thereon - - - - - - - - - - - - - - - - - - - -
d Restructured standard advances
which cease to attract higher
provisioning and / or additional
risk weight at the end of the FY No of borrowers - - - - - - - - - - -10.00 - - - -10.00 -10.00 - - - -10.00
and hence need not be shown as
restructured standard advances at
the beginning of the next FY
Amount
- - - - - - - - - - -0.06 - - - -0.06 -0.06 - - - -0.06
Outstanding
Provision thereon - - - - - - - - - - -0.03 - - - -0.03 -0.03 - - - -0.03
Financial Statements

135
NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
 Sr. Type of Restructuring Under CDR Under SME Debt Others Total

136
No. Mechanism Restructuring
Mechanism

Asset Classification

Sub-
Sub-
Sub-

Loss
Loss
Loss
Loss

Total
Total
Total
Total

Sub-
Doubtful
Doubtful
Doubtful
Doubtful

Standard
Standard
Standard
Standard

Standard
Standard
Standard
Standard
Details
e Down gradations of restructured
No of borrowers - - - - - - - - - - -406.00 406.00 - - - -406.00 406.00 - - -
accounts during the FY
Amount
- - - - - - - - - - -4.25 4.25 - - - -4.25 4.25 - - -
Outstanding
Provision thereon - - - - - - - - - - -1.65 1.65 - - - -1.65 1.65 - - -
f Write-offs of restructured accounts
No of borrowers - - - - - - - - - - - 232.00 - - 232.00 - 232.00 - - 232.00
during the FY*
Amount
- - - - - - - - - - - 2.68 - - 2.68 - 2.68 - - 2.68
(All amounts are in ` crore unless otherwise stated)

Outstanding
Provision thereon - - - - - - - - - - - 0.56 - - 0.56 - 0.56 - - 0.56
g Restructured accounts as on March
No of borrowers - - - - - - - - - - - 288.00 - - 288.00 - 288.00 - - 288.00
31 of the FY (closing figures*)
Amount
- - - - - - - - - - - 2.98 - - 2.98 - 2.98 - - 2.98
Outstanding
Provision thereon - - - - - - - - - - - 2.02 - - 2.02 - 2.02 - - 2.02

* Excluding the figures of standard restructured advances which do not attract higher provisioning or risk weight (if applicable).

Annual Report 2023-24

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

47 MATURITY ANALYSIS OF ASSETS AND LIABILITIES

The table below shows an analysis of assets and liabilities analysed according to when they are expected to be
recovered or settled.

Particulars As at As at
March 31, 2024 March 31, 2023
Within After Total Within After Total
12 months 12 months 12 months 12 months
Financial assets
Cash and cash equivalents 526.59 - 526.59 272.63 - 272.63
Bank balance other than cash
160.75 42.92 203.67 55.45 65.97 121.42
and cash equivalents
Derivative financial instruments - - - 3.07 - 3.07
Loans 1,976.45 2,026.67 4,003.12 1,431.30 1,124.14 2,555.44
Investments 10.61 - 10.61 84.46 - 84.46
Other financial assets 27.21 3.45 30.66 20.15 2.66 22.81
Non-financial assets -
Current tax assets (Net) 11.73 - 11.73 - 18.08 18.08
Deferred tax assets (Net) - 43.94 43.94 - 29.34 29.34
Property, plant and equipment - 8.96 8.96 - 5.46 5.46
Right of use assets - 21.43 21.43 - 21.15 21.15
Intangible assets under
- 2.95 2.95 - 0.47 0.47
development
Other intangible assets - 1.32 1.32 - 0.55 0.55
Other non-financial assets 7.94 0.13 8.07 5.13 - 5.13
Total assets 2,721.28 2,151.77 4,873.05 1,872.17 1,267.81 3,140.01
Financial liabilities
Derivative financial instruments 3.15 - 3.15 - - -
Debt securities 503.71 518.63 1,022.34 480.08 419.77 899.85
Borrowings
1,567.89 908.76 2,476.65 967.51 428.80 1,396.31
(other than debt securities)
Lease liability 6.97 16.66 23.63 6.97 17.32 24.29
Derivative financial instruments - - - - -
Other financial liabilities 55.42 - 55.42 16.07 - 16.07
Non-Financial Liabilities
Current tax liabilities (Net) - - - - - -
Provisions 15.26 15.03 30.29 14.53 8.14 22.67
Deferred tax liabilities (Net) - - - - - -
Other non-financial liabilities 25.46 - 25.46 12.32 - 12.32
Total liabilities 2,177.86 1,459.08 3,636.94 1,497.48 874.03 2,371.51
Net Amount 1,236.11 768.50

48 CAPITAL

The Company maintains an actively managed capital base to cover risks inherent in the business and is meeting
the capital adequacy requirements of the local banking supervisor, Reserve Bank of India (RBI). The adequacy of the
Company’s capital is monitored using, among other measures, the regulations issued by RBI.

Aye Finance Private Limited 137

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

The Company has complied in full with all its externally imposed capital requirements over the reported period. Equity
share capital and other equity are considered for the purpose of Company’s capital management.

Capital management
The primary objectives of the Company’s capital management policy are to ensure that the Company complies with
externally imposed capital requirements and maintains strong credit ratings and healthy capital ratios in order to
support its business and to maximise shareholder value.

The Company manages its capital structure and makes adjustments to it according to changes in economic conditions
and the risk characteristics of its activities. In order to maintain or adjust the capital structure, the Company may adjust
the amount of dividend payment to shareholders, return capital to shareholders or issue capital securities. No changes
have been made to the objectives, policies and processes from the previous years. However, they are under constant
review by the Board.

Regulatory capital
Particulars Carrying amount
As at As at
March 31, 2024 March 31, 2023
Tier I capital 1,058.77 656.38
Tier II capital - -
Total capital 1,058.77 656.38
Risk weighted assets 3,229.29 2,112.49
CRAR (%) * 32.79% 31.07%
Tier I capital (%) 32.79% 31.07%
Tier II capital (%) - -

* The above ratio has been computed in accordance with the relevant guidelines issued by the RBI.

Tier 1 capital consists of shareholders’ equity and retained earnings. Tier II capital consists of general provision and
loss reserve against standard assets . Tier 1 and Tier II has been reported on the basis of Ind AS financial information.

49 FINANCIAL RISK MANAGEMENT FRAMEWORK

The Company’s principal financial liabilities comprise borrowings from banks and debentures. The main purpose of
these financial liabilities is to finance the Company’s operations and to support its operations. The Company’s financial
assets include loan and advances, investments and cash and cash equivalents that derive directly from its operations.

In the course of its business, the Company is exposed to certain financial risks namely credit risk, interest risk, price
risk, currency risk & liquidity risk. The Company’s primary focus is to achieve better predictability of financial markets
and seek to minimise potential adverse effects on its financial performance.

The Company’s board of directors has an overall responsibility for the establishment and oversight of the Company’s
risk management framework. The board of directors has established the risk management committee and asset
liability committee, which is responsible for developing and monitoring the Company’s risk management policies. The
committee reports regularly to the board of directors on its activities.

The Company’s risk management policies are established to identify and analyse the risks faced by the Company, to
set appropriate risk limits and controls and to monitor risks and adherence to limits. risk management policies and
systems are reviewed regularly to reflect changes in market conditions and the Company’s activities.

The Company’s risk management committee oversees how management monitors compliance with the Company’s
risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to
the risks faced by the Company.

138 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

49.1 Credit risk management framework

Credit risk is the risk that the Company will incur a loss because its customers fail to discharge their contractual
obligations. The Company has a comprehensive framework for monitoring credit quality of its loans and advances
primarily based on days past due monitoring at year end. Repayment by individual customers and portfolio is tracked
regularly and required steps for recovery are taken through follow ups and legal recourse.

Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in
the same geographical region, or have similar economic features that would cause their ability to meet contractual
obligations to be similarly affected by changes in economic, political or other conditions. In order to avoid excessive
concentrations of risk, the Company’s policies and procedures include specific guidelines to focus on spreading its
lending portfolio across various products / states / customer base with a cap on maximum limit of exposure for an
individual / Group.

The below amounts does not include the impact of EIR on applicable fees and interest accrued on customer loans.

49.1.1 Credit quality of financial loan

Particulars Mortgage loans Quasi Mortgage loans Hypothecated and Switch pe loans
As at As at As at As at As at As at
March 31, March 31, March 31, March 31, March 31, March 31,
2024 2023 2024 2023 2024 2023
Gross carrying
value of loans
Stage 1 332.31 49.85 110.41 104.15 3,512.30 2,367.39
Stage 2 0.48 0.26 1.78 3.17 40.74 21.59
Stage 3 1.70 0.53 7.07 9.00 122.87 55.72
Gross carrying
value as at 334.49 50.64 119.26 116.32 3,675.91 2,444.70
reporting date

The Company reviews the credit quality of its loans based on the ageing of the loan at the year end and hence the
Company has calculated its ECL allowances on a collective basis.

49.1.2 Inputs considered in calculation of ECL

In assessing the impairment of financial loans under Expected Credit Loss (ECL) Model, the assets have been
segmented into three stages. The three stages reflect the general pattern of credit deterioration of a financial
instrument. The differences in accounting between stages, relate to the recognition of expected credit losses and
the measurement of interest income.

The Company categorises loan assets into stages primarily based on the Days Past Due status.

Stage 1 : 0 to 30 days past due

Stage 2 : 31 to 90 days past due

Stage 3 : More than 90 days past due

49.1.3 Definition of default

The Company considers a financial asset to be in “default” and therefore Stage 3 (credit impaired) for ECL
calculations when the borrower becomes 90 days past due on its contractual payments.

49.1.4 Exposure at default

Exposure at default” (EAD) represents the gross carrying amount of the assets subject to impairment calculation.

Aye Finance Private Limited 139

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

49.1.5 Estimations and assumptions used in the ECL model

(a) Loss given default (LGD) is common for all three Stages and is based on loss in past portfolio. Actual
cashflows on the past portfolio are considered at portfolio basis for arriving loss rate.

(b) Probability of default (PD) is applied on Stage 1, Stage 2 and Stage 3 portfolio . This is calculated as an
average of periodic movement of default rates.

49.1.6 Measurement of ECL

ECL is measured as follows:

(a) Financial assets that are not credit impaired at the reporting date: for Stage 1 & 2, gross exposure is multiplied
by PD and LGD percentage to arrive at the ECL.

(b) Financial assets that are credit impaired at the reporting date: the difference between the gross exposure at
reporting date and computed carrying amount considering EAD net of LGD ;

49.1.7 Significant increase in credit risk

The Company considers its exposure in credit risk to have increased significantly, when the borrower crosses 30
DPD.

49.1.8 Impairment loss

(a) The expected credit loss allowance for Mortgage loan is determined as follows:

Particulars Stage 1 Stage 2 Stage 3 Total

Performing- Under per - forming Impaired loans
loans loans Lifetime ECL not - lifetime ECL
12 month ECL credit impaired credit impaired
Gross carrying value as at
332.31 0.48 1.70 334.49
March 31, 2024
ECL rate 0.38% 33.33% 53.53%
ECL amount 1.27 0.16 0.91 2.34
Carrying amount (net of provision) 331.04 0.32 0.80 332.15
Gross carrying value as at
49.85 0.26 0.53 50.64
March 31, 2023
ECL rate 0.79% 25.89% 59.33%
ECL amount 0.39 0.07 0.19 0.65
Carrying amount (net of provision) 49.46 0.19 0.34 49.99

(b) The expected credit loss allowance for Quasi Mortgage loan is determined as follows:

Particulars Stage 1 Stage 2 Stage 3 Total

Performing- Under per - forming Impaired loans
loans loans Lifetime ECL not - lifetime ECL
12 month ECL credit impaired credit impaired
Gross carrying value as at
110.41 1.78 7.07 119.26
March 31, 2024
ECL rate 0.62% 23.60% 32.96%
ECL amount 0.69 0.42 2.33 3.44
Carrying amount (net of provision) 109.72 1.36 4.74 115.82
Gross carrying value as at
104.15 3.17 9.00 116.32
March 31, 2023
ECL rate 1.45% 13.57% 67.80%
ECL amount 1.51 0.43 4.20 6.14
Carrying amount (net of provision) 102.64 2.74 4.80 110.18

140 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

(c) The expected credit loss allowance for Hypothecated and Switch pe loan is determined as follows:

Particulars Stage 1 Stage 2 Stage 3 Total

Performing- Under per - forming Impaired loans
loans loans Lifetime ECL not - lifetime ECL
12 month ECL credit impaired credit impaired
Gross carrying value as at
3,512.30 40.74 122.87 3,675.91
March 31, 2024
ECL rate 0.46% 40.72% 74.66%
ECL amount 16.18 16.59 91.73 124.50
Carrying amount (net of provision) 3,496.12 24.15 31.14 3,551.41
Gross carrying value as at
2,367.39 21.59 55.72 2,444.70
March 31, 2023
ECL rate 0.65% 13.90% 71.26%
ECL amount 15.45 3.00 28.24 46.69
Carrying amount (net of provision) 2,351.94 18.59 27.48 2,398.01

49.1.9 Level of assessment - aggregation criteria

The Company recognises the expected credit losses (ECL) on a collective basis that takes into account
comprehensive credit risk information. Considering the economic and risk characteristics the Company calculates
ECL on a collective basis for all stages - Stage 1, Stage 2 and Stage 3 assets

49.1.10  n analysis of changes in the gross carrying amount and the corresponding ECLs in relation to Mortgage Loans is
A
as follows:

(a) Gross exposure reconciliation:

Particulars Stage 1 Stage 2 Stage 3 Total
Gross carrying amount as at March 31, 2022 7.35 1.19 0.40 8.94
Transfer to stage 1 -0.01 0.01 - -
Transfer to stage 2 -0.13 -0.09 0.22 -
Transfer to stage 3 -0.06 -0.11 0.17 -
Loans derecognised during the year -
Loans originated / derecognised during the year 42.55 -0.52 -0.23 41.80
Write offs during the year - - -0.10 -0.10
Gross carrying amount as at March 31, 2023 49.70 0.48 0.46 50.64

Changes due to loans recognised in the opening

balances that have :
Transfer to stage 1 0.26 -0.06 -0.20 -
Transfer to stage 2 -0.18 0.18 - -
Transfer to stage 3 -1.29 -0.20 1.49 -
Loans derecognised during the year
Loans originated / derecognised during the year 283.90 0.10 -0.01 283.99
Write offs during the year -0.08 -0.02 -0.04 -0.14
Gross carrying amount as at March 31, 2024 332.31 0.48 1.70 334.49

Aye Finance Private Limited 141

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

(b) Reconciliation of ECL balances

Particulars Stage 1 Stage 2 Stage 3 Total
ECL allowances balances as at March 31, 2022 0.10 0.14 0.23 0.47
Transfer to Stage 1 0.00 -0.00 - -
Transfer to Stage 2 - - - -
Transfer to Stage 3 -0.09 -0.05 0.14 -
Loans derecognised during the year -
Loans originated / derecognised during the year 0.38 -0.02 -0.08 0.28
Write offs during the year - - -0.10 -0.10
ECL allowances balances as at March 31, 2023 0.39 0.07 0.19 0.65
Changes due to loans recognised in the opening
balances that have :
Transfer to Stage 1 0.09 -0.02 -0.07 -
Transfer to Stage 2 - - - -
Transfer to Stage 3 -0.01 -0.05 0.06 -
Loans derecognised during the year
Loans originated / derecognised during the year 0.80 0.16 0.73 1.69
ECL allowances balances as at March 31, 2024 1.27 0.16 0.91 2.34

49.1.11 An analysis of changes in the gross carrying amount and the corresponding ECLs in relation to Quasi Mortgage
Loans is as follows:

(a) Gross exposure reconciliation:

Particulars Stage 1 Stage 2 Stage 3 Total
Gross carrying amount as at March 31, 2022 107.57 16.58 10.84 134.99
Transfer to Stage 1 1.24 -1.28) 0.04 0.00
Transfer to Stage 2 -2.03 2.04 -0.01 -0.01
Transfer to Stage 3 -4.69 -3.00 7.69 0.00
Loans derecognised during the year
Loans originated / derecognised during the year 2.34 -9.02 -2.84 -9.52
Write offs during the year -0.28 -2.15 -6.71 -9.15
Gross carrying amount as at March 31, 2023 104.15 3.17 9.00 116.32

Changes due to loans recognised in

Transfer to Stage 1 8.10 -1.63 -6.47 -
Transfer to Stage 2 -1.71 1.71 - -0.00
Transfer to Stage 3 -4.93 -1.21 6.14 -
Loans derecognised during the year
Loans originated / derecognised during the year 5.36 0.45 2.98 8.79
Write offs during the year -0.56 -0.71 -4.58 -5.85
Gross carrying amount as at March 31, 2024 110.41 1.78 7.07 119.26

142 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

(b) Reconciliation of ECL balances

Particulars Stage 1 Stage 2 Stage 3 Total
ECL allowances balances as at March 31, 2022 1.74 2.39 6.30 10.43
Transfer to Stage 1 0.00 -0.01 0.01 -
Transfer to Stage 2 -0.15 0.15 - -
Transfer to Stage 3 -2.02 -1.45 3.47 -
Loans derecognised during the year
Loans originated / derecognised during the year 2.12 0.77 -1.35 1.54
Write offs during the year -0.18 -1.42 -4.23 -5.84
ECL allowances balances as at March 31, 2023 1.51 0.43 4.20 6.14
Changes due to loans recognised in
Transfer to Stage 1 3.71 -0.27 -3.44 -
Transfer to Stage 2 -0.02 0.02 - -
Transfer to Stage 3 -0.06 -0.12 0.18 -
Loans derecognised during the year
Loans originated / derecognised during the year -4.45 0.36 1.39 -2.70
ECL allowances balances as at March 31, 2024 0.69 0.42 2.33 3.44

49.1.12 An analysis of changes in the gross carrying amount and the corresponding ECLs in relation to Hypothecated and
Switch pe loans is as follows:

(a) Gross exposure reconciliation:

Particulars Stage 1 Stage 2 Stage 3 Total
Gross carrying amount as at March 31, 2022 1,478.64 62.35 43.54 1,584.53
Transfer to Stage 1 4.43 -4.76 0.33 0.00
Transfer to Stage 2 -13.31 13.34 -0.01 0.01
Transfer to Stage 3 -39.71 -7.46 47.17 -
Loans derecognised during the year
Loans originated / derecognised during the year 938.77 -31.14 -3.70 903.93
Write offs during the year -1.42 -10.74 -31.61 -43.77
Gross carrying amount as at March 31, 2023 2,367.39 21.59 55.71 2,444.70

Changes due to loans recognised in the opening

balances that have :
Transfer to Stage 1 55.13 -11.57 -43.56 -
Transfer to Stage 2 -38.90 38.92 -0.02 0.00
Transfer to Stage 3 -116.37 -9.12 125.49 -
Loans derecognised during the year
Loans originated / derecognised during the year 1,249.00 9.11 24.11 1,282.21
Write offs during the year -3.95 -8.19 -38.86 -51.00
Gross carrying amount as at March 31, 2024 3,512.30 40.74 122.87 3,675.91

Aye Finance Private Limited 143

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

(b) Reconciliation of ECL balances

Particulars Stage 1 Stage 2 Stage 3 Total
ECL allowances balances as at March 31, 2022 7.87 8.40 27.33 43.60
Transfer to Stage 1 -0.03 -0.03 0.05 -0.00
Transfer to Stage 2 -1.60 1.60 -0.00 -
Transfer to Stage 3 -19.46 -3.55 23.01 -
Loans derecognised during the year
Loans originated / derecognised during the year 29.53 3.55 -0.88 32.20
Write offs during the year -0.86 -6.97 -21.28 -29.11
ECL allowances balances as at March 31, 2023 15.45 3.00 28.23 46.69
Changes due to loans recognised in the opening
balances that have :
Transfer to Stage 1 26.35 -1.75 -24.60 -0.00
Transfer to Stage 2 -0.24 0.25 -0.01 -
Transfer to Stage 3 -0.73 -1.09 1.82 -
Loans derecognised during the year
Loans originated / derecognised during the year -24.65 16.18 86.29 77.82
ECL allowances balances as at March 31, 2024 16.18 16.59 91.73 124.50

Cash and cash equivalent and bank deposits

The Company maintains its bank balances in reputed banks and financial institutions. The credit risk is limited
because the counterparties are banks with high credit ratings assigned by international credit rating agencies.

49.2 Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its
financial liabilities (other than derivatives) that are settled by delivering cash or another financial asset. The Company’s
approach to managing liquidity is to ensure as far as possible, that it will have sufficient liquidity to meet its liabilities
when they are due.

Liquidity risk management in the Company is managed as per the guidelines of Board-approved Asset-Liability
Management (‘ALM’) Policy which is monitored by the Asset Liability Committee. The ALM Policy provides the
governance framework for the identification, measurement, monitoring and reporting of liquidity risk arising out of
Company’s lending and borrowing activities. The Company maintains flexibility in funding by maintaining availability
under committed credit lines. Management monitors the Company’s liquidity positions (also comprising the undrawn
borrowing facilities) and cash and cash equivalents on the basis of expected cash flows. The Company also takes into
account liquidity of the market in which the entity operates.

Maturities of financial liabilities

The table below analyses non-derivative financial liabilities of the Company into relevant maturity groupings based on
the remaining period from the reporting date to the contractual maturity date.

Particulars As at As at
March 31, 2024 March 31, 2023
Within After Total Within After Total
12 months 12 months 12 months 12 months
Financial liabilities
Lease liabilities 6.97 16.66 23.63 6.97 17.32 24.29
Debt securities 503.71 518.63 1,022.34 480.08 419.77 899.85
Borrowings
1,567.89 908.76 2,476.65 967.51 428.80 1,396.31
(other than debt securities)

144 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Particulars As at As at
March 31, 2024 March 31, 2023
Within After Total Within After Total
12 months 12 months 12 months 12 months
Trade payables - - - - - -
Other financial liabilities 55.42 - 55.42 16.07 - 16.07
Derivative Financial Instrument -3.15 - -3.15 - - -
2,130.84 1,444.05 3,574.89 1,470.63 865.89 2,336.52

49.3 Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes
in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such
as equity price risk and commodity price risk. Financial instruments affected by market risk include foreign currency
receivables.

49.3.1 Foreign currency risk

Currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign
exchange rates. Foreign currency risk for the Company arises majorly on account of foreign currency
borrowings. When a derivative is entered into for the purpose of being as hedge, the Company negotiates
the terms of those derivatives to match with the terms of the hedge exposure. The Company’s policy
is to fully hedge its foreign currency borrowings at the time of drawdown and remain so till repayment.
The Company holds derivative financial instruments such as cross currency interest rate swap to mitigate risk of
changes in exchange rate in foreign currency and floating interest rate. The counterparty for these contracts is
generally a bank. These derivative financial instruments are valued based on quoted prices for similar assets and
liabilities in active markets or inputs that are directly or indirectly observable in market place.

The carrying amounts of the Company’s foreign currency exposure at the end of the reporting period are as
follows:

Particulars Currency As at As at
March 31, 2024 March 31, 2023
Financial liabilities, ` crore US$ 220.94 123.33
Financial liabilities, ` crore EURO 135.33 134.41

49.3.2 Interest rate risk

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of change in
market interest rates. The Company does not have any exposure to the risk of changes in market interest rates as
the Company does not have any borrowings/loans on fluctuating interest rates except following:-

(a) Liabilities
Particulars As at As at
March 31, 2024 March 31, 2023
Debt securities
Variable rate 10.02 261.14
Fixed rate 1,012.32 638.71
Borrowings (other than debt)
Variable rate 966.02 615.76
Fixed rate 1,510.63 780.55
Sensitivity analysis
Increase by 80 basis points 7.81 6.27
Decrease by 80 basis points -7.81 -6.27

Aye Finance Private Limited 145

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

(b) Assets
The Company’s fixed deposits are carried at amortised cost and are fixed rate deposits and therefore not subject
to interest rate risk, since neither the carrying amount nor the future cash flows will fluctuate because of a change
in market interest rates. Loans extended by the Company are all fixed rate loans

(c) Price risk exposure

The Company’s Investment in Mutual Funds is exposed to pricing risk. Other financial instruments held by the
Company does not possess any risk associated with trading.

Particulars As at As at
March 31, 2024 March 31, 2023
Investments 10.61 84.21
Sensitivity analysis
increase by 4% - 2.34
decrease by 4% - -2.34

50 LEASES

50.1.1 Carrying value of lease liabilities:

Particulars Total Leases
Balance at March 31, 2022 23.35 23.35
Additions 7.51 7.51
Finance cost 3.16 3.16
Lease payments -9.74 -9.74
Balance at March 31, 2023 24.28 24.28
Additions 10.06 10.06
Finance cost 2.21 2.21
Early termination -1.23 -1.23
Adjustment of earlier year -0.42 -0.42
Lease payments -11.27 -11.27
Balance at March 31, 2024 23.63 23.63

50.1.2 Maturity analysis of lease liabilities

Particulars As at As at
March 31, 2024 March 31, 2023
Less than one year 11.19 9.59
One to five years 17.35 19.47
More than five years 0.39 0.22
Undiscounted lease liabilities at March 31, 2023 28.93 29.28

50.1.3 Amounts recognised in profit or loss

Particulars As at As at
March 31, 2024 March 31, 2023
Interest on lease liabilities 2.21 3.16
Depreciation on ROU assets 9.45 7.32
11.66 10.48

146 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

50.1.4 Cash outflow of leases

Particulars As at As at
March 31, 2024 March 31, 2023
Cash outflow of leases
Lease payments 11.27 9.76
11.27 9.76

50.1.5 Break up value of the current and non-current lease liabilities for the year ended March 31, 2023
Particulars As at As at
March 31, 2024 March 31, 2023
Current lease liabilities 6.97 6.97
Non-current lease liabilities 16.66 17.32
23.63 24.29

51 FINANCIAL INSTRUMENTS AND FAIR VALUE DISCLOSURES

Valuation principles
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in
the principal (or most advantageous) market at the measurement date under current market conditions (i.e. an exit
price), regardless of whether that price is directly / indirectly observable or estimated using a valuation technique. In
order to show how fair values have been derived, financial instruments are classified based on a hierarchy of valuation
techniques.

Fair value hierarchy of asset and liabilities measured at fair value

Particulars As at March 31, 2024
Level 1 Level 2 Level 3 Total
At fair value through profit and Loss
Financial asset
Derivative financial instruments - - - -
Investments
Mutual funds - - - -
Mutual funds held as security in
- - - -
respect of borrowings
Security receipts - 15.71 - 15.71
- 15.71 - 15.71
Financial liabilities
Derivative financial instruments - -3.15 - -3.15
- -3.15 - -3.15

Particulars As at March 31, 2023

Level 1 Level 2 Level 3 Total
At fair value through profit and Loss
Financial Asset
Derivative financial instruments - 3.07 - 3.07
Investments
Mutual funds 58.51 - - 58.51
Mutual funds held as security in
- - - -
respect of borrowings

Aye Finance Private Limited 147

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Particulars As at March 31, 2023

Level 1 Level 2 Level 3 Total
Security receipts - 30.80 - 30.80
58.51 33.87 - 92.38
Financial Liabilities
Derivative financial instruments - - - -
- - - -

Fair Value hierarchy of Asset and Liabilities not measured at fair value
The management assessed that carrying value of financial asset and financial liabilities are a reasonable approximation
of their fair value and hence their carrying values are deemed to be fair values.

Valuation methodologies of financial instruments not measured at fair value

Loans
Most of the loans are repriced frequently, with interest rate of loans reflecting current market pricing. Hence carrying
value of loans is deemed to be equivalent of fair value.

Borrowings
Debt securities and borrowings are fixed rate borrowings and fair value of these fixed rate borrowings is determined by
discounting expected future contractual cash flows using current market interest rates charged for similar new loans
and carrying value approximates the fair value for fixed rate borrowing at financial statement level. The Company’s
borrowings which are at floating rate approximates the fair value.

Short term and other financial assets and liabilities

The management assessed that cash and cash equivalents, investments, other financial assets, trade payables
and other financial liabilities approximate their carrying amounts largely due to the short-term maturities of these
instruments.

52  isclosures pursuant to Reserve bank of India notification DOR (NBFC).CC.PD.No.109/22.10.106/2019-20 dated March
D
13, 2020 pertaining to Asset Classification as per RBI Norms

52.1 For the year March 31, 2024

Asset classification as Asset Gross Loss allowances Net carrying Provisions Difference
per RBI Norms classification carrying (provisions) as amount required as between
as per Ind AS amount as required under Ind per IRACP Ind AS 109
109 per Ind AS AS 109 norms provisions and
IRACP norms
(1) (2) (3) (4) (5) = (6) (7) =
(3) - (4) (4)-(6)
Performing assets
Standard Stage 1 3,955.02 18.14 3,936.88 16.27 1.87
Standard Stage 2 43.01 17.18 25.83 0.23 16.95
Subtotal 3,998.03 35.32 3,962.71 16.50 18.82
Non-performing assets
(NPA)
Sub - standard Stage 3 124.87 93.38 31.49 12.34 81.04
Subtotal Sub 124.87 93.38 31.49 12.34 81.04
-Standard
Doubtful - up to 1 year Stage 3 6.72 1.58 5.14 6.10 -4.52
1 to 3 years Stage 3 0.04 - 0.04 0.04 -0.04
More than 3 years Stage 3 - - - - -

148 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Asset classification as Asset Gross Loss allowances Net carrying Provisions Difference
per RBI Norms classification carrying (provisions) as amount required as between
as per Ind AS amount as required under Ind per IRACP Ind AS 109
109 per Ind AS AS 109 norms provisions and
IRACP norms
(1) (2) (3) (4) (5) = (6) (7) =
(3) - (4) (4)-(6)
Subtotal Doubtful 6.76 1.58 5.18 6.14 -4.56
Loss assets - - - - -
Subtotal NPA Stage 3 131.63 94.96 36.67 18.48 76.48
Other items such Stage 1 - - - - -
as guarantees, loan Stage 2 - - - - -
commitments, etc.
which are in the scope
of Ind AS 109 but not
covered under current
Income Recognition, Stage 3 - - - - -
Asset Classification
and Provisioning
(IRACP) norms
All assets Stage 1 3,955.02 18.14 3,936.88 16.27 1.87
Stage 2 43.01 17.18 25.83 0.23 16.95
Stage 3 131.63 94.96 36.67 18.48 76.48
Total 4,129.66 130.28 3,999.38 34.98 95.30
Note 1: The above table discloses the provisions amounts as per IRACP norms, while the Company has made a provision
of non-performing assets as per the Company’s policy which is in excess of the IRACP norms.

52 Disclosures pursuant to Reserve bank of India notification DOR (NBFC).CC.PD.No.109/22.10.106/2019-20 dated March
13, 2020 pertaining to Asset Classification as per RBI Norms

52.2 For the year March 31, 2023

Asset classification as Asset Gross Loss allowances Net Provisions Difference
per RBI Norms classification carrying (provisions) as carrying required as between
as per Ind AS amount as required under Ind amount per IRACP Ind AS 109
109 per Ind AS AS 109 norms provisions and
IRACP norms
(1) (2) (3) (4) (5) = (3)-(4) (6) (7) = (4)-(6)
Performing assets
Standard Stage 1 2,521.39 17.36 2,504.03 11.08 6.28
Standard Stage 2 25.02 3.50 21.52 0.40 3.10
Subtotal 2,546.41 20.86 2,525.55 11.48 9.38
Non-performing assets
(NPA)
Sub - standard Stage 3 65.18 32.61 32.57 7.28 25.33
Subtotal Sub -Standard 65.18 32.61 32.57 7.28 25.33
Doubtful - up to 1 year Stage 3 0.06 - 0.05 0.06 -0.06
1 to 3 years Stage 3 0.01 0.01 - 0.01 -
More than 3 years Stage 3 - - - - -
Subtotal Doubtful 0.07 0.01 0.05 0.07 -0.06
Loss assets - - - - -

Aye Finance Private Limited 149

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Asset classification as Asset Gross Loss allowances Net Provisions Difference

per RBI Norms classification carrying (provisions) as carrying required as between
as per Ind AS amount as required under Ind amount per IRACP Ind AS 109
109 per Ind AS AS 109 norms provisions and
IRACP norms
(1) (2) (3) (4) (5) = (3)-(4) (6) (7) = (4)-(6)
Subtotal NPA Stage 3 65.25 32.62 32.62 7.35 25.27
Other items such Stage 1 - - - - -
as guarantees, loan Stage 2 - - - - -
commitments, etc.
which are in the scope
of Ind AS 109 but not
covered under current
Income Recognition, Stage 3 - - - - -
Asset Classification and
Provisioning (IRACP)
norms
All assets Stage 1 2,521.39 17.36 2,504.03 11.08 6.28
Stage 2 25.02 3.50 21.52 0.40 3.10
Stage 3 65.25 32.62 32.62 7.35 25.27
Total 2,611.66 53.48 2,558.17 18.83 34.65

Note 1: The above table discloses the provisions amounts as per IRACP norms, while the Company has made a provision
of non-performing assets as per the Company’s policy which is in excess of the IRACP norms.

Note 2: The above amounts does not include the impact of EIR on applicable fees and interest accrued on customer
loans.

53  BI circular RBI/DNBR/2016-17/45 Master Direction DNBR. PD. 008/03.10.119/2016-17 September 01, 2016, as
R
amended.

53 ASSET LIABILITY MANAGEMENT - MATURITY PATTERN OF CERTAIN ITEMS OF ASSETS AND LIABILITIES

As at March 31, 2024

Particulars 1 to 7 8 to 14 15 days Over Over Over Over Over Over Over 5 Total
days days to 30/31 1 month 2 months 3 months 6 months 1 year 3 year years
days up to up to up to up to up to up to
2 months 3 months 6 months 1 year 3 years 5 years
Deposits - - - - - - - - - -
Advances* 225.72 - - 155.80 158.10 484.39 952.46 1,798.59 180.53 43.84 3,999.42
Investments^ 250.31 40.02 18.61 17.87 12.89 51.29 59.85 42.92 - - 493.76
Borrowing** 44.73 29.04 119.63 141.53 257.09 493.27 908.21 993.07 89.21 59.46 3,135.24
Foreign currency
- - - - - - - - - - -
assets
Foreign currency
- - - - - - 78.10 191.08 94.57 - 363.75
liabilities

As at March 31, 2023

Particulars 1 to 7 8 to 14 15 days Over Over Over Over Over Over Over 5 Total
days days to 30/31 1 month 2 months 3 months 6 months 1 year 3 year years
days up to up to up to up to up to up to
2 months 3 months 6 months 1 year 3 years 5 years
Deposits - - - - - - - - - -
Advances* 158.45 - - 108.00 114.59 352.36 697.89 1,141.17 30.24 6.22 2,608.92
Investments^ 218.84 - 70.00 3.37 5.02 35.04 43.90 64.89 - - 441.06

150 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Particulars 1 to 7 8 to 14 15 days Over Over Over Over Over Over Over 5 Total
days days to 30/31 1 month 2 months 3 months 6 months 1 year 3 year years
days up to up to up to up to up to up to
2 months 3 months 6 months 1 year 3 years 5 years
Borrowing** 5.07 20.08 55.80 105.47 93.02 341.79 678.15 651.51 79.10 - 2,029.99
Foreign currency
- - - - - - - - - - -
assets
Foreign currency
- - - - 91.92 44.83 4.71 98.16 26.55 - 266.17
liabilities

Notes
* EIR on advances has been considered as per repayment schedule.
* Net of provision for standard and non performing asset.
* Advances not included staff loan.
* The advances are gross of impairment loss allowance.
** EIR on borrowing has been considered in the last bucket of the respective borrowing.
^ Investments include the amount of deposits with banks.
(a) Advances and borrowings are inclusive of the securitisation transactions which have not been de-recognised in
the books of accounts in accordance with Ind AS 109.
(b) Above ALM does not consider cash balance existing as on balance sheet date.

53.2 Summary of material accounting policies

Refer to note 2 of Financial Statements for summary of material accounting policies.

53.3 Capital
Particulars March 31, 2024 March 31, 2023
(a) CRAR (%) 32.79% 31.07%
(b) CRAR - Tier I Capital (%) 32.79% 31.07%
(c) CRAR - Tier II Capital (%) - -
(d) Amount of subordinated debt raised as Tier-II capital - -
(e) Amount raised by issue of perpetual debt instruments - -

53.4 Investments
Particulars March 31, 2024 March 31, 2023
Value of investments
Gross value of investments
In India 15.96 89.56
Outside India - -
Provisions for depreciation
In India 5.35 5.10
Outside India - -
Net value of investments
In India 10.61 84.46
Outside India - -
Movement of provisions held towards depreciation on investments
Opening balance 5.10 2.94
Add : Provisions made during the year 0.25 2.16
Less Write-off / write-back of excess provisions during the year - -
Closing balance 5.35 5.10

Aye Finance Private Limited 151

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

53.5 Derivatives
53.5.1 Forward rate agreement / interest rate swap
Particulars March 31, 2024 March 31, 2023
The notional principal of swap agreements 356.27 257.74
Losses which would be incurred if counterparties failed to fulfil their
- -
obligations under the agreements
Collateral required by the NBFC upon entering into swaps - -
Concentration of credit risk arising from the swaps* - -
The fair value of the swap book -3.15 3.07

* Counter- party for all swaps entered into by the Company are Scheduled Commercial Banks.

53.5.2 Exchange traded interest rate (IR) derivatives

Particulars Amount
Notional principal amount of exchange traded IR derivatives undertaken during the year
(instrument-wise)
a) Nil Nil
b) Nil Nil
c) Nil Nil
Notional principal amount of exchange traded IR derivatives outstanding as on March 31,
2024 (instrument-wise)
a) Nil Nil
b) Nil Nil
c) Nil Nil
Notional principal amount of exchange traded IR derivatives outstanding and not "highly
effective" (instrument-wise)
a) Nil Nil
b) Nil Nil
c) Nil Nil
Mark-to-market value of exchange traded IR derivatives outstanding and not "highly
effective" (instrument-wise)
a) Nil Nil
b) Nil Nil
c) Nil Nil

53.5.3 Disclosures on risk exposure in derivatives

Qualitative disclosures
The Company undertakes the derivatives transaction to prudently hedge the risk in context of a particular
borrowing or to diversify sources of borrowing and to maintain fixed and floating borrowing mix. The Company
does not indulge into any derivative trading transactions. The Company reviews, the proposed transaction and
outline any considerations associated with the transaction, including identification of the benefits and potential
risks (worst case scenarios); an independent analysis of potential savings from the proposed transaction. The
Company evaluates all the risks inherent in the transaction viz., counter party risk, Market Risk, Operational Risk,
basis risk etc.

Credit risk is controlled by restricting the counterparties that the Company deals with, to those who either have
banking relationship with the Company or are internationally renowned or can provide sufficient information.

152 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Market/Price risk arising from the fluctuations of interest rates and foreign exchange rates or from other factors
shall be closely monitored and controlled. Normally transaction entered for hedging, will run over the life of the
underlying instrument, irrespective of profit or loss. Liquidity risk is controlled by restricting counterparties to
those who have adequate facility, sufficient information, and sisable trading capacity and capability to enter into
transactions in any markets around the world.

The respective functions of trading, confirmation and settlement should be performed by different personnel.
The front office and back-office role is well defined and segregated. All the derivatives transactions are quarterly
monitored and reviewed. All the derivative transactions have to be reported to the board of directors on every
quarterly board meetings including their financial positions.

Quantitative disclosures
Particulars As at As at
March 31, 2024 March 31, 2023
Currency Interest Currency Interest
Derivatives* Rate Derivatives* Rate
Derivatives Derivatives
Derivative (notional principal amount) – for hedging 356.27 - 257.74 -
Marked to market positions -3.15 - 3.03 -
Credit exposure 356.27 - 257.74 -
Unhedged exposures - - - -

* Cross currency interest rate swap

53.6 Disclosures relating to Securitisation (Refer Note No. 45 of the financial statements.)

53.7 Exposures
53.7.1 Exposure to real estate sector
Category March 31, 2024 March 31, 2023
(a) Direct exposure
Residential mortgages 431.76 162.04
Lending fully secured by mortgages on residential property
that is or will be occupied by the borrower or that is rented. 431.76 162.04
Exposure would also include non-fund based limits.
Commercial real estate 22.00 4.92
Lending secured by mortgages on commercial real estates
(office buildings, retail space, multi- purpose commercial
premises, multi-family residential buildings, multi-tenanted
22.00 4.92
commercial premises, industrial or warehouse space, hotels,
land acquisition, development and construction, etc.). Exposure
would also include non-fund based limits
Investments in Mortgage Backed Securities (MBS) and other
NIL NIL
securitised exposures
Residential NIL NIL
Commercial real estates NIL NIL
(b) Indirect Exposure
Fund based and non-fund-based exposures on National
NIL NIL
Housing Bank and Housing Finance Companies.
453.76 166.96

Aye Finance Private Limited 153

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

53.7.2 Exposure to capital market

Particulars March 31, 2024 March 31, 2023
(a) Direct investment in equity shares, convertible bonds,
convertible debentures and units of equity-oriented mutual
0.25 NIL
funds the corpus of which is not exclusively invested in
corporate debt;
(b) Advances against shares / bonds / debentures or other
securities or on clean basis to individuals for investment in
NIL NIL
shares (including IPOs / ESOPs), convertible bonds, convertible
debentures, and units of equity-oriented mutual funds;
(c) Advances for any other purposes where shares or convertible
bonds or convertible debentures or units of equity oriented NIL NIL
mutual funds are taken as primary security;
(d) Advances for any other purposes to the extent secured by the
collateral security of shares or convertible bonds or convertible
debentures or units of equity oriented mutual funds i.e. where
NIL NIL
the primary security other than shares / convertible bonds /
convertible debentures / units of equity oriented mutual funds'
does not fully cover the advances;
(e) Secured and unsecured advances to stockbrokers and
guarantees issued on behalf of stockbrokers and market NIL NIL
makers;
(f) Loans sanctioned to corporates against the security of shares
/ bonds / debentures or other securities or on clean basis
NIL NIL
for meeting promoter's contribution to the equity of new
companies in anticipation of raising resources;
(g) Bridge loans to companies against expected equity flows /
NIL NIL
issues;
(h) Underwriting commitments taken up by the NBFCs in respect
of primary issue of shares or convertible bonds or convertible NIL NIL
debentures or units of equity oriented mutual funds
(i) Financing to stockbrokers for margin trading NIL NIL
(j) All exposures to Alternative Investment Funds:
(i) Category I NIL NIL
(ii) Category II NIL NIL
(iii) Category III NIL NIL
0.25 NIL

Note : The above 53.7.1 & 53.7.2, information is provided as per MIS/reports generated available for internal
reporting purpose which include certain estimates and assumptions. The same has been relied upon by the
auditors.

53.8 Details of financing of parent company products

The Company doesn’t have parent Company, hence this clause is not applicable.

53.9 Details of Single Borrower Limit (SBL) / Group Borrower Limit (GBL) exceeded by the NBFC
The Company has not exceeded the Single Borrower Limit (SGL) / Group Borrower Limit (GBL) during the March 31,
2024 and March 31, 2023

53.10 Unsecured advances

The Company has given ` 1659.19 crore (previous year: ` 816.18 crore) of unsecured loans.

154 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

53.11 Miscellaneous
53.11.1 Registration obtained from other financial sector regulators
The Company does not hold any other registration other than NBFC registration from RBI.

Registration/ License Issuing Authority Registration / License number

Certificate of Registration Reserve Bank Of India (RBI) B-14.03323

53.11.2 Disclosure of penalties imposed by RBI and other regulators –

No penalties were imposed by the regulator during the year ended March 31, 2024 and March 31, 2023

53.11.3 Related party transactions

Refer note 36 of Financial Statements for related party transaction disclosure.

The Company have not entered into any transactions related to borrowings, deposits, placement of deposits,
advances, purchase/sale of fixed/other assets and Investments during the year with directors, KMP and their
relatives. Hence there is no outstanding balance during the year.

53.11.4 Ratings assigned by credit rating agencies and migration of ratings during the year
Rating purpose 2023-24 2022-23
Rating Rating Rating Rating
Assigned Outlook Assigned Outlook
Aye Finance Private Limited by India Ratings & Research
NCD ` 1013.79 (previous year 1248.83 crore)* [IND] A- Positive [IND] A- Stable
Bank loans 500 crore (previous year ` 400 crore)* [IND] A- Positive [IND] A- Stable
Commercial paper ` 50 crore [IND] A1 Positive [IND] A2+ Stable
Principal protected market-linked debenture (PP-MLD)
IND PP-MLD A - Positive IND PP-MLD A - Stable
` 195 crore (previous year 210 crore)
Aye Finance Private Limited by ICRA
NCD for the previous year ` 65.00 crore** N.A. N.A. [ICRA] BBB+ Stable

** ICRA ratings withdrawn w.e.f. May 16, 2023. Rating at the time was BBB+ with positive outlook

 *Rating letter dated Feb 20, 2024. As per the rating, the long term rating outlook of the Company was upgraded
to “Positive” from “Stable”. Rating of A- was reaffirmed. Additionally, Short term rating was upgraded to A1 from
A2+.

53.12 Additional disclosures

53.12.1 Provisions and contingencies
Break up of 'provisions and contingencies' shown under the head March 31, 2024 March 31, 2023
expenditure in the statement of profit and loss account
Provisions for depreciation on investment - 5.10
Provision towards NPA 62.38 (1.24)
Provision made towards income tax net of deferred tax 66.73 17.61
Other provision and contingencies (Gratuity and Leave encashment) 7.39 1.06
Provision for Standard assets 14.42 0.22

53.12.2 Draw down from reserves

The Company has not made any drawdown from the reserve during the year.

53.13 Concentration of deposits, advances, exposures and NPAs

The Company has not taken any deposits from any party.

Aye Finance Private Limited 155

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

53.13.1 Concentration of advances

Particulars March 31, 2024 March 31, 2023
Total advances to twenty largest borrowers 2.13 1.83
Percentage of Advances to twenty largest borrowers to Total
0.05% 0.07%
Advances of the NBFC

53.13.2 Concentration of exposures

Particulars March 31, 2024 March 31, 2023
Total exposure to twenty largest borrowers / customers 2.13 32.72
Percentage of exposures to twenty largest borrowers / customers to
0.05% 1.24%
total exposure of the NBFC on borrowers / customers

53.13.3 Concentration of NPAs

Particulars March 31, 2024 March 31, 2023
Total exposure to top four credit impaired accounts 0.28 0.18

53.13.4 Sector-wise NPAs

Sector Percentage of NPAs
to total advances in that sector
March 31, 2024 March 31, 2023
(a) Agriculture and allied activities - -
(b) MSME 3.19% 2.49%
(c) Corporate borrowers - -
(d) Services - -
(e) Unsecured personal loans - -
(f) Auto loans - -
(g) Other personal loans - -

53.13.5 Movement of NPAs

Particulars March 31, 2024 March 31, 2023
(a) Net NPAs to Net Advances (%) 0.91% 1.28%
(b) Movement of NPAs (Gross)
(i) Opening balance 65.39 57.28
(ii) Additions during the year 119.44 61.29
(iii) Reductions during the year -53.20 -53.18
(iv) Closing balance 131.63 65.39
(c) Movement of Net NPAs
(i) Opening balance 32.81 23.42
(ii) Additions during the year 28.85 31.07
(iii) Reductions during the year -24.99 -21.68
(iv) Closing balance 36.67 32.81
(d) Movement of provisions for NPAs (excluding provisions on
standard assets)
(i) Opening balance 32.58 33.86
(ii) Additions during the year 90.59 30.22
(iii) Reductions during the year -28.21 -31.50
(iv) Closing balance 94.96 32.58

156 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

53.14 Overseas assets

The Company does not own any assets outside the country.

53.15 Off – balance sheet SPVs sponsored

The Company does not have any off balance sheet SPV sponsored either domestic or overseas.

53.16 Disclosure of customer complaints

53.16.1 Summary information on complaints received by the NBFCs from customers and from the Offices of Ombudsman
S. Particulars March 31, 2024 March 31, 2023
No.
Complaints received by the NBFC from its customer
(a) No. of complaints pending at the beginning of the year 4 -
(b) No. of complaints received during the year 864 405
(c) No. of complaints redressed during the year 856 401
Of which, number if complaints rejected by the NBFC* - -
(d) No. of complaints pending at the end of the year 12 4
Maintainable complaints received by the NBFC from office of
Ombudsman
(e) Maintainable complaints received by the NBFC from office of
31 14
Ombudsman
Of (e) , No of complaints resolved in favour of the NBFC from
31 13
office of Ombudsman
Of (e) ,No of complaints resolved through Conciliation/
- 1
Mediation/advisories issued by office of Ombudsman
Of (e) ,No of complaints resolved after passing of awards by
- -
office of Ombudsman against the NBFC
(e) (i) No. of awards unimplemented with in the Stipulated time
- -
( other than those appealed)

* Represents number of complaints submitted by internal ombudsman to RBI vide circular no. RBI/2021-2022/126
dated November 15, 2021

Note : The above information is provided as per MIS/reports generated available for internal reporting purpose
which include certain estimates and assumptions. The same has been relied upon by the auditors.

53.16.2 Top five grounds of complaints received by the NBFCs from customers

March 31, 2024

SL Grounds of complaints Number of Number of %Increase / Number of Of 5, number
No. complaints complaints decrease in complaints of complaints
pending at received the number pending at the pending beyond
the beginning during the of complaints end of the year 30 days
of the year year received over the
previous year
(a) Credit Bureau Rectification 2 327 57% 6 -
(b) Customer Interaction Issue 1 235 279% 3 -
(c) Customer Dispute or
- 53 212% 1 -
Money Misappropriate
(d) Settlement Related - 60 NA - -
(e) Contact Number Update/
- 32 191% 1 -
Removal (non-Existing)
(f) Others 1 157 67% 1 -
4 864 113% 12 -

Aye Finance Private Limited 157

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

March 31, 2023

SL Grounds of complaints Number of Number of %Increase / Number of Of 5, number
No. complaints complaints decrease in complaints of complaints
pending at received the number pending at the pending beyond
the beginning during the of complaints end of the year 30 days
of the year year received over the
previous year
(a) Credit Bureau
- 208 121% 2 -
Rectification
(b) Customer Interaction
- 62 40% 1 -
Issue
(c) Refund issue (Charges/
- 17 467% - -
extra EMI refund)
(d) Settlement Related - 13 217% - -
(e) Commission Asked - 11 1100% - -
(f) Others - 94 104% 1 -
- 405 96% 4 -

Note : The above information is provided as per MIS/reports generated available for internal reporting purpose
which include certain estimates and assumptions. The same has been relied upon by the auditors.

53.17 Expenditure on corporate social responsibility

Refer note 31 of Financial Statements for disclosure pertaining to corporate social responsibility expenses.

53.18 Disclosure on frauds pursuant to RBI Master Direction

The frauds detected and reported for the year amounted to ` 0.42 crore (March 31, 2023 ` 0.06 crore).

53.19 Micro, Small and Medium Enterprises (MSME) sector - Restructuring of advances
 he Company has restructured the accounts as per RBI circular circulars DBR.No.BP.BC.100/21.04.048/2017-18 dated
T
February 07, 2018, DBR.No.BP.BC.108/21.04.048/2017-18 dated June 06, 2018, DBR.No.BP.BC.18/21.04.048/2018-
19 dated January 01, 2019, circular DOR.No.BP.BC.34/21.04.048/2019-20 dated February 11, 2020 and DOR.No.BP.
BC/4/21.04.048/2020-21 dated August 06, 2020.

Particulars March 31, 2024 March 31, 2023

No. of accounts restructured 343 1,436
Amount (` in crore)* 2.61 10.36

* Balances are as at March 31, 2024

53.20 Details of the Code on Social Security, 2020 (‘CODE’) relating to employee benefits
 he Code on Social Security, 2020 (‘Code’) relating to employee benefits during employment and post-employment
T
benefits received Presidential assent in September, 2020. The Code has been published in the Gazette of India.
However, the date on which the Code will come into effect has not been notified and the final rules/interpretation have
not yet been issued. The Company will assess the impact of the Code when it comes into effect and will record any
related impact in the period the Code becomes effective.

53.21 The Company owns 100% of Foundation for Advancement of Micro Enterprises (FAME), incorporated under Section
8 of the Companies Act, 2013, to carry on social responsibility activities. The financial statements of FAME are not
considered for consolidation since the definition of control is not met as the Company’s objective is not to obtain
economic benefits from the activities of FAME.

158 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

53.22 Transactions with non-executive directors

Name of non-executive director Transaction type March 31, 2024 March 31, 2023
Mr. Navin Kumar Maini Payment of sitting fees 0.05 0.10
Ms. Kanika Tandon Bhal Payment of sitting fees 0.07 0.03
Mr. Vinay Baijal Payment of sitting fees 0.05 0.08
Ms. Arpita Pal Agarwal Payment of sitting fees 0.03 0.04
Mr. Sanjay Gupta Payment of sitting fees 0.07 -
Mr. Govinda Rajulu Chinta Payment of sitting fees 0.08 -
0.35 0.25

53.23 Postponement of revenue recognition

There is no significant uncertainty which requires postponement of revenue recognition.

53.24 Details of dues to micro and small enterprises as defined under the MSMED Act, 2006
 ayment against the supplies from the undertakings covered under the Micro, Small & Medium Enterprises Development
P
Act, 2006 are generally made in accordance with the agreed credit terms.

On the basis of information and record available with the management, there are no outstanding balances of such
suppliers and interest due on such accounts as on March 31, 2024

The Company has neither paid any interest nor such amount is payable to buyer covered under the MSMED Act, 2006.

53.25 Details of non-performing financial assets purchased/sold

 he Company has not sold non performing financial asset during 2023-24 and has sold non performing financial asset
T
during 2022-23. Refer Note no. 53.27.1 (c ).

53.26 Value of imports calculated on CIF basis

The Company has not imported any goods therefore value of import on CIF basis is Nil. (As on March 31, 2023 – Nil).

53.27 D
 isclosure pursuant to Master Direction - Reserve Bank of India (Transfer of Loan Exposures) Directions, 2021 issued
by the Reserve Bank of India (“RBI”) vide their Notification No. RBI/DOR/2021-22/86 Master Direction DOR.STR.
REC.51/21.04.048/2021-22 dated September 24, 2021 (the “Notification”)
53.27.1 Details of non-performing assets (NPAs) transferred are given below:
Disclosure pursuant to RBI notification - RBI/DOR/2021-22/86 DOR.STR.REC.51/21.04.048/2021-22 dated
September 24, 2021

(a) Details of transfer through assignment in respect of loans not in default during the year ended.

March 31, 2024 March 31, 2023

Aggregate amount of loans transferred 246.78 206.98
Retention of beneficial economic interest (MRR) 10% 10%
Weighted average maturity (residual maturity) 18.4 months 16.7 months
Weighted average holding period 7.64 months 7.1 months
Coverage of tangible security - -
Rating-wise distribution of rated loans Unrated Unrated

(b) Details of loans re-purchased in compliance with paragraph 48 of Master Direction - RBI (Transfer of loan
exposures) Directions, 2021 during the year ended March 31, 2024: Nil

Aye Finance Private Limited 159

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

(c) (i) Details of stressed loans transferred during the year ended March 31, 202
Particulars To Asset Reconstruction
Companies (ARC)
NPA* SMA
No. of accounts 9,024 -
Aggregate principal outstanding of loans transferred (` in crore) 83.76 -
Weighted average residual tenor of the loans transferred (in months) 11 months -
Net book value of loans transferred (at the time of transfer)
11.11 -
(` in crore)
Aggregate consideration (` in crore) 13.28 -
Additional consideration realised in respect of accounts transferred
- -
in earlier year

*Including written off loans amounting to ` 51.65 crore

(c) (ii) The Company has not transferred any stressed loan during the financial year ended March 31, 2024
(d) The Company has not acquired any stressed loan during the financial year ended March 31, 2024 & March
31,2023

53.27.2 The Company has not acquired any special mention account or stressed loan or loan not in default.
53.27.3 Disclosures as required for liquidity risk

(a) Funding concentration based on significant counterparty (both deposits and borrowings)
Particulars March 31, 2024 March 31, 2023
Number of significant counter parties 33 34
Amount 3,014.14 2,082.37
Percentage of funding concentration to total deposits N.A. N.A.
Percentage of funding concentration to total liabilities 82.89% 87.81%

(b) Top 20 large deposits

Particulars March 31, 2024 March 31, 2023
Total amount of top 20 deposits N.A. N.A.
Percentage of amount of top 20 deposits to total deposits N.A. N.A.

(c) Top 10 borrowings

Particulars March 31, 2024 March 31, 2023
Total amount of top 10 borrowings 1,788.90 1,113.37
Percentage of amount of top 10 borrowings to total borrowings 49.19% 48.49%

(d) Funding concentration based on significant instrument/product

Name of the instrument/product March 31, 2024 March 31, 2023
Amount % of Total Amount % of Total
Liabilities Liabilities
Non-convertible debentures (Secured) 912.64 25.09% 771.92 32.55%
Non-convertible debentures (Unsecured) 109.70 3.02% 127.93 5.39%
Term Loans 1,307.06 35.94% 525.09 22.14%
Borrowing under securitisation arrangement 800.85 22.02% 562.04 23.70%
External commercial borrowings 363.74 10.00% 266.18 11.22%
Working capital/Line of credit/Overdraft facility** - - 43.00 1.81%

** Current Year it is less than 1% hence it is not disclosed.

160 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

(e) Stock ratios

Particulars March 31, 2024 March 31, 2023
Commercial papers as a % of total public funds - -
Commercial papers as a % of total liabilities - -
Commercial papers as a % of total assets - -
Non-convertible debentures as a % of total public funds - -
Non-convertible debentures as a % of total liabilities - -
Non-convertible debentures as a % of total assets - -
Other short-term liabilities as a % of total public funds 62.24% 65.22%
Other short-term liabilities as a % of total liabilities 59.88% 63.14%
Other short-term liabilities as a % of total assets 44.69% 47.69%

Note 1 : Significant counterparty is as defined in RBI Circular RBI/1019-20/88 DOR. NBFC (PD) CC. No. 102/03.
10.001/2019-20 dated November 4, 2019 on liquidity risk management framework for NBFC and Core Investment
Companies.

Note 2 : Significant instrument/product is as defined in RBI Circular RBI/1019-20/88 DOR. NBFC (PD) CC. No.
102/03. 10.001/2019-20 dated November 4, 2019 on liquidity risk management framework for NBFC and Core
Investment Companies.

Note 3 : Public funds are as defined in Master Direction - Non Banking Financial Company - Scale based circular
DOR.CRE.REC.No.60/03.10.001/2021-22 dated October 22, 2021.

53.28 Transfer of financial assets

53.28.1 Transferred financial assets that are not derecognised in their entirety
The following tables provide a summary of financial assets that have been transferred in such a way that part or
all of the transferred financial assets do not qualify for derecognition, together with the associated liabilities.

The Company has transferred certain pools of fixed rate loan receivables backed by underlying assets by entering
into securitisation transactions with the Special Purpose Vehicle Trusts (SPV Trust) sponsored by financial
institution for consideration received in cash at the inception of the transaction.

The Company, being Originator of these loan receivables, also acts as Servicer with a responsibility of collection
of receivables from its borrowers and depositing the same in Collection and Pay-out Account maintained by the
SPV Trust for making scheduled pay-outs to the investors in Pass Through Certificates (PTCs) issued by the SPV
Trust. These securitisation transactions also requires the Company to provide for first loss credit enhancement
in various forms, such as corporate guarantee, cash collateral etc. as credit support in the event of shortfall in
collections from underlying loan contracts. By virtue of existence of credit enhancement, the Company is exposed
to credit risk, being the expected losses that will be incurred on the transferred loan receivables to the extent of
the credit enhancement provided. In view of the above, the Company has retained substantially all the risks and
rewards of ownership of the financial asset and thereby does not meet the derecognition criteria as set out in Ind-
AS 109. Consideration received in this transaction is presented as ‘Borrowing under Securitisation’ under Note 14.

Particulars March 31, 2024 March 31, 2023

Carrying amount of transferred assets measured at amortised cost 891.30 596.81
Carrying amount of associated liabilities (Debt securities -measured
800.85 562.03
at amortised cost)

Aye Finance Private Limited 161

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

53.28.2 Transferred financial assets that are derecognised

During the year , the Company has assigned (earlier measured at amortised cost) by way of direct assignment as
per the agreed terms of the deals. Since substantial risk and rewards related to these assets were transferred to the
buyer, the asset have been de-recognised from the books of accounts. The table below summarises the carrying
amount of the derecognised financial assets measured at amortised cost and the gain/(loss) on derecognition
during the year.

Particulars March 31, 2024 March 31, 2023

Carrying amount of transferred assets measured at amortised cost 214.14 122.07
Carrying amount of exposures retained by the Company at
21.41 12.21
amortised cost
Gain on sale of the derecognised financial assets 18.95 12.51

Since the Company transferred the above financial asset in a transfer that qualified for derecognition in its
entirely, therefore the whole of the interest spread (over the expected life of the asset) is recognised on the day
of derecognition itself as interest strip receivable and correspondingly recognised as gain on derecognition of
financial asset

53.29 D
 etail of resolution plan implemented under the resolution framework for Covid - 19 related stress as per RBI circular
dated August 06, 2020 (resolution framework - 1.0) and May 05, 2021 (resolution framework - 2.0) as March 31, 2024
as given below: -
Type of Borrowers Exposure to Of (A), Of (A) amount Of (A) amount Exposure
accounts classified aggregate written off paid by the to accounts
as Standard debt that during the borrowers classified
consequent to slipped in to period ended during the as Standard
implementation of NPA during the March 31, period ended consequent to
resolution plan- period ended 2024 March 31, implementation
Position as at March March 31, 2024** of resolution plan
31, 2023 (A) * 2024 - Position as at
March 31, 2024 *
Personal Loans # 9.63 1.29 2.28 4.68 1.38
Corporate Persons - - - - -
MSMEs - - - - -
Others - - - - -
9.63 1.29 2.28 4.68 1.38

* Consist of unbilled and overdue principal

** Includes portfolio sold to ARC

#
 Includes restructuring implemented pursuant to OTR 2.0 for personal loans, individual business loans and small
business loans.

53.30 Changes in liabilities arising from financing activities *

Particulars April 01, 2023 Cash flows Exchange difference Other March 31, 2024
Debt securities 899.85 136.71 - -14.22 1,022.34
Borrowings (other than
834.27 841.40 6.18 -6.05 1,675.80
debt securities)
Borrowings under
562.04 239.57 - -0.77 800.85
securitisation
2,296.16 1,217.68 6.18 -21.04 3,498.99

162 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Particulars April 01, 2022 Cash flows Exchange Other March 31, 2023
difference
Debt securities 922.23 -22.38 - - 899.85
Borrowings (other than
489.62 279.70 -6.96 71.91 834.27
debt securities)
Borrowings under
108.89 453.15 - - 562.04
securitisation
1,520.74 710.47 -6.96 71.91 2,296.16

* Amounts are inclusive of accrued interest.

53.31 Pursuant to Regulation 54 of the SEBI (Listing Obligations & Disclosure Requirement) Regulations, 2015 we would
like to state that all listed secured non-convertible debentures of the Company are secured by way of first exclusive
charge on hypothecated book debts of the Company up to the extent minimum of 100% of the amount outstanding.

53.32 There are no significant subsequent events that have occurred after the reporting period till the date of approval of
these financial statements.

53.33 Intra Group Exposure

The Company does not have any Intragroup Exposures for the Year ended March 31, 2024 & March 31, 2023.

53.34 Unhedged Foreign currency Exposure

 he Company has Nil Unhedged Foreign currency Exposure as at March 31, 2024 & March 31, 2023. Refer Note 49 for
T
policies to manage induce foreign currency risk.

53.35 Loans to directors, senior officers and relatives of directors

 he Company has not provided any loans to directors, senior officers and relatives of directors during the year ended
T
March 31, 2024 and March 31, 2023

53.36 Details of penalties imposed by RBI and other regulators

No penalty was levied during the year ended March 31,2024 and March 31,2023.

53.37 Breach of covenant

The Company has no instance of breach of covenant in respect of loans availed and debt securities issued as at March
31, 2024 and March 31, 2023

53.38 Divergence in Asset Classification and Provisioning

 BI vide its circular RBI/2022-23/26 DOR.ACC.REC.No.20/21.04.018/2022-23 dated April 19, 2022 has directed NBFCs
R
shall make suitable disclosures, if either or both of the following conditions are satisfied:

(a) the additional provisioning requirements assessed by RBI (or National Housing Bank(NHB) in the case of Housing
Finance Companies) exceeds 5 percent of the reported profits before tax and impairment loss on financial
instruments for the reference period, or

(b) the additional Gross NPAs identified by RBI/NBH exceeds 5 percent of the reported Gross NPAs for the reference
period.

No inspection conducted by the RBI during the financial year ended March 31, 2024

53.39 Disclosure on Modified Opinion

The auditor have expressed an unmodified opinion for year ended March 31, 2024 & March 31, 2023.

Aye Finance Private Limited 163

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

53.40 Sectoral exposure

Sector FY 2023-2024 FY 2022-2023
Total Gross % of Gross Total Gross % of Gross
Exposure NPAs NPA to Total Exposure NPAs NPA to Total
Exposure Exposure
(a) Agriculture and allied
- - - - - -
activities
(b) Industry - - - - - -
(c) Services - - - - - -
(d) Personal loans - - - - - -
(e) Others - MSME 4,129.66 131.63 3.19% 2,621.56 65.39 2.49%

N
 ote : The above information is provided as per MIS/reports generated available for internal reporting purpose which
include certain estimates and assumptions. The same has been relied upon by the auditors.

53.41 Net Profit or Loss for the period, prior period items and changes in accounting policies: There are no any prior period
items and changes in accounting policies.

54 OTHER NOTES

Balance Sheet disclosures as required under Master Direction – Reserve Bank of India (Non-Banking Financial
Company – Scale Based Regulation) Directions, 2023 dated October 19, 2023 (as amended) issued by the Reserve
Bank of India.

Liabilities Side:

54.1 Loans and advances availed by the NBFC inclusive of interest accrued thereon but not paid:
Particulars Amount Amount
Outstanding Overdue
(a) Debentures:
(i) Secured 912.64 -
(ii) Unsecured 109.70 -
(other than falling within the meaning of Public deposits*)
(b) Deferred credits
(c) Term loans 1,670.80 -
(d) Inter - corporate loans and borrowings
(e) Commercial paper
(f) Public deposits
(g) Other loans
(i) Liabilities in respect of securitised transactions 800.85
(ii) Loans repayable on demand 5.00

* Please see Note 1 below

54.2 Break-up of (1)(f) above (Outstanding public deposits inclusive of interest accrued thereon but not paid):
Particulars Amount Amount
Outstanding Overdue
(a) In the form of Unsecured debentures - -
(b) In the form of partly secured debentures i.e. debentures where there is a
- -
shortfall in the value of security
(c) Other public deposits - -

* Please see Note 1 below

164 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Assets Side:

54.3 Break-up of Loans and Advances including bills receivables [other than those included in (4) below]:
Particulars Amount
Outstanding
(a) Secured 2,474.21
(b) Unsecured 1,659.19

54.4 Break up of Leased Assets and stock on hire and other assets counting towards asset financing activities

Particulars Amount
Outstanding
(i) Lease assets including lease rentals under sundry debtors:
(a) Financial Lease -
(b) Operating Lease -
(ii) Stock on hire including hire charges under sundry debtors:
(a) Assets on hire -
(b) Repossessed Assets -
(iii) Other loans counting towards asset financing activities
(a) Loans where assets have been repossessed -
(b) Loans other than (a) above -

Assets Side:
54.5 Break-up of investments:
Particulars Amount
Outstanding
Current investments:
1 Quoted:
(i) Shares:
(a) Equity -
(b) Preference -
(ii) Debentures and bonds -
(iii) Units of mutual funds -
(iv) Government securities -
(v) Others -
2 Unquoted:
(i) Shares:
(a) Equity -
(b) Preference -
(ii) Debentures and bonds -
(iii) Units of mutual funds -
(iv) Government securities -
(v) Others(security receipt - ARCIL TRUST) 15.71
Long Term Investments:

Aye Finance Private Limited 165

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

Particulars Amount
Outstanding
1 Quoted:
(i) Shares: -
(a) Equity -
(b) Preference -
(ii) Debentures and bonds -
(iii) Units of mutual funds -
(iv) Government securities -
(v) Others -
2 Unquoted:
(i) Shares:
(a) Equity 0.25
(b) Preference -
(ii) Debentures and bonds -
(iii) Units of mutual funds -
(iv) Government securities -
(v) Others (security receipt - ARCIL TRUST) -

54.6 Borrower group-wise classification of assets financed as in (3) and (4) above : (Please see Note 2 below)
Category Amount Net of Provisions
Secured Unsecured Total
1 Related Parties**
(a) Subsidiaries - - -
(b) Companies in the same group - - -
(c) Other related parties - - -
2 Other than related parties 2,403.40 1,599.72 4,003.12
2,403.40 1,599.72 4,003.12

54.7 I nvestor group-wise classification of all investments (current and long term) in shares and securities (both quoted and
unquoted) : (Please see Note 3 below)
Category Market Value/ Book Value
Break-up or fair (Net of
value or NAV Provisions)
1 Related Parties **
(a) Subsidiaries 0.25 -
(b) Companies in the same group - -
(c) Other related parties - -
2 Other than related parties 15.71 10.61
15.96 10.61

** As per notified Accounting Standard (Please see below Note 3)

166 Annual Report 2023-24

 Financial Statements

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

54.8 Other information

Particulars Amount
(i) Gross non-performing assets
(a) Related parties -
(b) Other than related parties 131.63
(ii) Net non-performing assets
(a) Related parties -
(b) Other than related parties 36.67
(iii) Assets acquired in satisfaction of debts (net of provision) -

Notes:

1 As defined in Paragraph 5.1.26 of the RBI NBFC Directions.

2 Provisioning norms shall be applicable as prescribed in these Directions.

3 All notified Accounting Standards and Guidance Notes issued by ICAI are applicable including for valuation of
investments and other assets as also assets acquired in satisfaction of debt. However, market value in respect of
quoted investments and break up / fair value / NAV in respect of unquoted investments shall be disclosed irrespective
of whether they are classified as long term or current in (5) above.

55 OTHER STATUTORY INFORMATION

(a) The Company do not have any investment property.

(b) The Company do not have any benami property, where any proceeding has been initiated or pending against the
group for holding any benami property.

(c) Since, the Company does not have any immovable property, clause related to title deeds of property not held in the
Company’s own name is not applicable.

(d) The Company do not have any charges or satisfaction which is yet to be registered with Registrar of Companies
beyond the statutory period for borrowings.

(e) The Company is a NBFC - Middle Layer as classified under Master Direction - Reserve Bank of India (Non-Banking
Financial Company - Scale Based Regulations) Directions, 2023.

(f) The quarterly statement of current assets submitted to banks/ financial institutions which are provided as security
against the borrowings are in agreement with the books of account.

(g) There has been no significant events after the reporting date require disclosure in these financial statements.

(h) The Company has not entered any transactions with companies that were struck off under Section 248 of the
Companies Act, 2013 or Section 560 of the Companies Act, 1956.

(i) The Company has not traded or invested in crypto currency or virtual Currency during the financial year.

(j) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign
entities (intermediaries) with the understanding that the intermediary shall:
(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on
behalf of the Company (ultimate beneficiaries) or
(b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

Aye Finance Private Limited 167

NOTES FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2024 (CONTD.)
(All amounts are in ` crore unless otherwise stated)

The Company has not received any fund from any person(s) or entity(ies), including foreign entities (funding party)
with the understanding (whether recorded in writing or otherwise) that the Company shall:
(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on
behalf of the funding party (ultimate beneficiaries) or
(b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries

(k) The Company do not have any such transaction which is not recorded in the books of accounts that has been
surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such
as, search or survey or any other relevant provisions of the Income Tax Act, 1961.

(l) During the year, no scheme of arrangements in relation to the Company has been approved by the competent
authority in terms of Sections 230 to 237 of the Companies Act, 2013. Accordingly, aforesaid disclosure are not
applicable to the Company.

(m) The Company has not advanced or granted loan to promoter, director, KMP & related party.

(n) The Company is not declared wilful defaulter by any bank or financial institution or other lenders.

(o) During the financials year 2023-24 and financials year 2022-23, The Company has not invested with number of
layers of Companies as prescribed under clause (87) of Section 2 of the Act read with the Companies (Restriction
on number of Layers) Rules, 2017

In terms of our report attached

For S S Kothari Mehta & Co. LLP For and on behalf of the Board of Directors of
Chartered Accountants Aye Finance Private Limited
Firm Registration No.: 000756N / N500441

per Vijay Kumar Sanjay Sharma Govinda Rajulu Chintala Krishan Gopal Tripti Pandey
Partner Managing Director Chairperson and Chief Financial Officer Company Secretary
Independent Director
Membership No: DIN: 03337545 DIN: 03622371 Membership No: 32760
092671
New Delhi Gurugram Virginia, USA Gurugram Gurugram
May 24, 2024 May 24, 2024 May 24, 2024 May 24, 2024 May 24, 2024

168 Annual Report 2023-24

 Statutory Reports

NOTICE OF 31ST ANNUAL GENERAL MEETING OF

AYE FINANCE PRIVATE LIMITED

Shorter Notice is hereby given that 31st Annual General thereunder & any other circulars, notifications &
Meeting of the Members of AYE FINANCE PRIVATE guidelines issued in this regard [including any statutory
LIMITED (“Company”) will be held on Friday, September 27, modification(s), enactment(s) or re-enactment(s)
2024 at 4:00 P.M. (IST) through Video conferencing (“VC”) thereof for the time being in force] read with Articles
or Other Audio Visual Mode (“OAVM”) deemed to be called of Association of the Company, consent of the
at the Corporate Office of the Company at Unit No. 701-711, members be and is hereby accorded to the Board of
7th Floor, Unitech Commercial Tower - 2, Sector-45, Arya Directors (hereinafter referred to as the “Board” which
Samaj Road, Gurugram-122003, Haryana, India to transact term shall include any committee constituted / may
the following businesses: - be constituted by the Board to exercise its powers
including the powers conferred under this resolution)
ORDINARY BUSINESS:
to raise or borrow from time to time such sum or sums
1. 
TO RECEIVE, CONSIDER, APPROVE AND ADOPT of monies in any form whether in Indian rupees or in
THE AUDITED FINANCIAL STATEMENTS OF THE foreign currency, in any form or manner and in one
COMPANY FOR THE FINANCIAL YEAR ENDED or more tranches including but not limited to by way
MARCH 31, 2024 ALONG WITH THE REPORTS OF THE of loan or financial facility/assistance from various
DIRECTORS AND STATUTORY AUDITORS THEREON banks, financial institutions and/or other lenders and/
or by way of issue of debentures/bonds/commercial
To consider and if thought fit, to pass, with or without
papers/external commercial borrowings or such other
modification(s), the following resolution as an Ordinary
Resolution: instrument, with or without security, whether in India or
outside India on such terms and conditions as the Board

“RESOLVED THAT pursuant to applicable provisions or any committee authorised for the same may deem
of Companies Act, 2013 read with rules made fit for the purposes of the Company notwithstanding
thereunder, Securities & Exchange Board of India that the monies already borrowed and the monies to
(Listing Obligations and Disclosure Requirements)
be borrowed (apart from temporary loans obtained
Regulations, 2015 (including any statutory
from its bankers in the ordinary course of business)
modification(s) or re-enactment(s), thereof for the
may exceed the aggregate of the paid up share capital,
time being in force) (“SEBI Listing Regulations”), the
free reserves and securities premium of the Company
Audited Financial Statements including Balance Sheet
not set apart for any specific purpose provided that the
of the Company as on March 31, 2024, the Statement
total amount up to which monies may be borrowed by
of Profit & Loss Account and Cash Flow Statement for
the Board of Directors shall not remain outstanding
the Financial Year ended March 31, 2024 together with
for more than ` 7,000 crore (Rupees Seven Thousand
the schedules/notes thereto along with Reports of the
crore only) at any point of time.
Board of Directors and Statutory Auditors together
with its annexures thereon be and are hereby received, 
RESOLVED FURTHER THAT the Board, be and is
considered, approved and adopted.” hereby authorised and empowered to arrange or settle
the terms and conditions on which all such monies
SPECIAL BUSINESSES: are to be borrowed from time to time as to interest,
repayment, security or otherwise, howsoever, as it may
2. 
TO INCREASE THE BORROWING LIMIT OF THE
think fit and to do all such acts, deeds and things as
COMPANY FROM ` 4,000 CRORE TO ` 7,000 CRORE
may be necessary and incidental for giving effect to
UNDER SECTION 180(1)(C) OF THE COMPANIES ACT,
the above, including execution of all such documents,
2013
instruments and writings, as may be required.”
To consider and if thought fit, to pass, with or without
modification(s), the following resolution as Special 3. CREATION OF CHARGES ON THE MOVABLE AND/OR
Resolution: IMMOVABLE PROPERTIES OF THE COMPANY, BOTH
“RESOLVED THAT in supersession of an earlier PRESENT AND FUTURE, UNDER SECTION 180(1)
resolution passed by the members of the Company in (A) OF THE COMPANIES ACT, 2013 IN RESPECT OF
their 30th Annual General Meeting held on September BORROWINGS OF THE COMPANY
29, 2023 and pursuant to the provisions of Section To consider and if thought fit, to pass, with or without
180(1)(c) & other applicable provisions, if any, of the modification(s), the following resolution as Special
Companies Act, 2013 (“Act”) read with rules made Resolution:

Aye Finance Private Limited 169

NOTICE (CONTD.)


“RESOLVED THAT in supersession of an earlier repayment, security or otherwise, howsoever, as it may
resolution passed by the members of the Company in think fit and to do all such acts, deeds and things as
their 30th Annual General Meeting held on September may be necessary and incidental for giving effect to
29, 2023 and pursuant to the provisions of Section the above, including execution of all such documents,
180(1)(a) of the Companies Act, 2013 (“Act”) read instruments and writings, as may be required.”
with rules made thereunder and other applicable
provisions, if any & any other circulars, notifications & 4. ISSUANCE OF NON-CONVERTIBLE DEBENTURES IN
guidelines issued in this regard (including any statutory ONE OR MORE TRANCHES ON PRIVATE PLACEMENT
modification(s), enactment(s) or re-enactment(s) BASIS
thereof for the time being in force) read with Articles To consider and if thought fit, to pass, with or without
of Association of the Company, consent of the modification(s), the following resolution as Special
members be and is hereby accorded to the Board of Resolution:
Directors (hereinafter referred to as the “Board” which

“RESOLVED THAT in supersession of an earlier
term shall include any committee constituted / may
resolution passed by the members of the Company in
be constituted by the Board to exercise its powers
their 30th Annual General Meeting held on September
including the powers conferred under this resolution)
29, 2023 and pursuant to the provisions of Sections
to create such charges, mortgages, lien, pledge,
23, 42, 71 and other applicable provisions, if any,
hypothecation and/or any other form of security interest
of the Companies Act, 2013 (“Act”) read with the
of any nature and any kind in addition to the existing
Companies (Prospectus and Allotment of Securities)
charges, mortgages, lien, pledge, hypothecation and/
Rules, 2014 and the Companies (Share Capital and
or any other form of security interest of any nature
Debentures) Rules, 2014, the Securities and Exchange
and any kind created by the Company, on such
Board of India (Issue and Listing of Non-Convertible
movable and/or immovable properties including book
debt, receivables of the Company, both present and Securities) Regulations, 2021, the Securities and
future, including where such assets and properties Exchange Board of India (Listing Obligations and
constitute the whole or substantially the whole of Disclosure Requirements) Regulations, 2015, the SEBI
the undertaking of the Company, in such manner as Master Circular for issue and listing of Non-convertible
the Board or any committee authorised for the same Securities, Securitised Debt Instruments, Security
may deem fit, in certain events in favour of banks/ Receipts, Municipal Debt Securities and Commercial
financial institutions and their subsidiaries, mutual Paper dated May 22, 2024 (including any statutory
funds, trusts, other body corporates and any other modification(s), enactment(s) or re-enactment(s)
lenders (or any agent, security trustee, debenture thereof for the time being in force) and the enabling
trustees or any other person acting on their behalf) for provisions of the listing agreement(s) entered into with
the holders of debentures/bonds/other instruments to the stock exchange(s) where the applicable securities
secure inter-alia loan or financial facility/assistance of the Company are listed, Master Direction - Reserve
from various banks, financial institutions and/or other Bank of India (Non-Banking Financial Company – Scale
lenders and/or by way of issue of debentures/bonds/ Based Regulation) Directions, 2023 and all other rules,
commercial papers/external commercial borrowings regulations, guidelines, notifications, clarifications and
or such other instrument, etc. (hereinafter collectively circulars, if any, issued by any statutory/regulatory
referred to as the “Loans”) which may be issued on authority, as may be applicable, the Memorandum and
private placement basis or otherwise to secure the Articles of Association of the Company and subject to
due payment of the principal together with interest, such consents, approvals, permissions and sanctions
premium on pre-payment or on redemption, costs, of the concerned statutory and regulatory authorities,
charges, expenses and all other monies payable by the if any and to the extent necessary, the consent of the
Company in respect of the said Loans for which the members be and is hereby accorded to the Board of
charge is to be created, shall not exceed ` 7,000 crore Directors (hereinafter referred to as the “Board” which
(Rupees Seven Thousand crore only) at any point of term shall include any committee constituted / may
time. be constituted by the Board to exercise its powers
including the powers conferred under this resolution)

RESOLVED FURTHER THAT the Board, be and is
to create, offer, invite for subscription, issue and
hereby authorised and empowered to arrange or settle
allot non-convertible debentures ((a) subordinated /
the terms and conditions on which all such monies
are to be borrowed from time to time as to interest, unsubordinated, (b) listed, (c) senior secured, (d) senior

170 Annual Report 2023-24

 Statutory Reports

NOTICE (CONTD.)

unsecured, (e) unsecured, (f) market linked debentures, and individual(s), as the case may be or such other
(g) perpetual or non-perpetual, and/or (h) any others person/persons/investors as the Board may so decide/
(as may be determined)) (“NCDs”) by way of private approve in its absolute discretion, for a period of 1
placement, in 1 (one) or more series or tranches, from (one) year, from the date of approval of this resolution
time to time, to any category of investors eligible by the Members of the Company and the Limit shall be
to invest in the NCDs, provided that the aggregate subject to the overall borrowing limits of the Company,
amount to be raised through the issuance of NCDs as approved by the Members of the Company from
shall not collectively exceed an overall limit of ` 4,000 time to time under Section 180(1)(c) of the Act.
crore (Rupees Four Thousand crore only) (“Limit”)

RESOLVED FURTHER THAT the Board be and is
on such terms and conditions including the price,
hereby authorised to execute all such agreements,
coupon, premium / discount on face value, redemption
documents, instruments and writings as deemed
premium, tenor etc. and at such times whether at
necessary, file requisite forms or applications with
par/premium/discount, as may be determined by the
statutory/regulatory authorities, with the power to
Board to such person or persons including one or more
settle all questions, difficulties or doubts that may
company(ies), bodies corporate, foreign portfolio
arise, in this regard and do all such acts, deeds and
investor(s), overseas fund(s), statutory corporation(s),
things as may be considered necessary or desirable
commercial bank(s), domestic and multilateral
in connection with or incidental thereto to give effect
lending agency(ies), financial institution(s), insurance
to the above resolution, including but not limited to
company(ies), mutual fund(s), alternative investment
disclosures with stock exchanges and to comply with
fund(s), pension/provident fund(s), family office(s),
all other requirements in this regard.”

By order of the Board

For Aye Finance Private Limited

Sd/-
(Vipul Sharma)
Place: Gurugram Company Secretary, Compliance Officer
Date: September 19, 2024 & Chief Compliance Officer

Aye Finance Private Limited 171

NOTICE (CONTD.)

NOTES: 109 of the Act. In case of a poll on any resolution at the

1. In pursuant with relaxations provided by the Ministry AGM, members are requested to convey their vote by
of Corporate Affairs, Government of India (“MCA”) e-mail at [email protected].
vide its General Circulars No. 20/2020 dated May 7. The Members attending the AGM through VC/OAVM
5, 2020, 02/2021 dated January 13, 2021, 19/2021 shall be counted for the purpose of reckoning the
dated December 8, 2021, 21/2021 dated December quorum for the AGM under Section 103 of the Act.
14, 2021, 2/2022 dated May 5, 2022, 10/2022 dated
8. The Register of Directors and Key Managerial Personnel
December 28, 2022, 09/2023 dated September 25,
and their Shareholding maintained under Section 170
2023 (collectively referred to as “MCA Circulars”),
of the Act and Register of Contracts or arrangement
the Companies are allowed to hold Annual General
in which Directors are interested maintained under
Meeting (“AGM”) through Video Conferencing (“VC”)
Section 189 of the Act and all the documents referred
or Other Audio Visual Means (“OAVM”), without the
to in the AGM Notice and Explanatory Statement
physical presence of Members at a common venue.
annexed to the AGM Notice shall be available for
2. In compliance with applicable provisions of the inspection at the Registered & Corporate Office of the
Companies Act, 2013 (“Act”) read with aforesaid Company on working days between 11:00 A.M. to 1:00
MCA Circulars, the 31st AGM of the Company being P.M. from the date of circulation of this Notice up to
conducted through VC / OAVM via Zoom Software. the date of the AGM.
A copy of the Annual Report of the Company for F.Y.
2023-24 and Notice of 31st AGM inter-alia indicating 9. The Members can participate in the AGM by installing
the process and manner of attending the AGM through Zoom software in their computer systems (from the
VC are being sent by e-mail to the Members, Debenture link given below) and dialing:
Trustee(s), Statutory Auditors, Secretarial Auditors, Zoom Meeting Link
Directors of the Company and to all other persons so https://us06web.zoom.us/j/83402589007?pwd=Dx
entitled whose e-mail IDs have been made available to LS2rIhrpb9Lvy6mjIAaIQwWfD2Wo.1
the Company / Registrar and Transfer Agent (“RTA”)
Meeting ID: 834 0258 9007
i.e. KFin Technologies Limited or with Depository
Participants (“DP”). Further, Members may note that Passcode: 581474
Annual Report for the F.Y. 2023-24 and the Notice
10. The Members who need assistance in connection with
of 31st AGM will also be available on the Company’s
using the said technology before or during the AGM,
website at www.ayefin.com and on the website of BSE
may reach out to the Company:
Limited at www.bseindia.com.
Name: Mr. Deepak Prajapati (Ph. No- +91-9540981064)
3. Since this AGM is being held pursuant to the MCA
Circulars through VC/OAVM, physical attendance of 11. Non-Resident Indian members are requested to inform
Members has been dispensed with. Accordingly, the RTA/ the Company, immediately of:
facility for appointment of proxies by the Members
a. 
Change in their residential status on return to
will not be available for the AGM and hence the Proxy
India for permanent settlement.
Forms, Attendance Slips and Route Map of Venue are
not annexed to this Notice. b. Particulars of their bank account maintained in
India with complete name, branch, account type,
4. Pursuant to provisions of Section 113 of the Act,
account number and address of the bank with pin
Corporate and other Non-Individual Members are
code number, if not furnished earlier.
required to send a duly certified true copy (PDF Format)
of their Board Resolution/ Governing Body Resolution/ 12. Statement pursuant to Section 102(1) of the Act, in
Authority Letter for authorising their representatives to respect of the Special Businesses to be transacted
attend and vote at the AGM by email to secretarial@ in the AGM along with details pursuant to Secretarial
ayefin.com. Standards on General Meetings issued by the Institute
of Company Secretaries of India (ICSI) (“SS-2”) and
5. In case of Joint Members attending the meeting, only
other applicable laws are annexed with this notice.
such Joint Shareholder who is first in the order of
names will be entitled to vote during the AGM. 13. As this AGM is being called at shorter notice pursuant
6. Since, the Company is not required to conduct e-voting, to Section 101 of the Act and rules made thereunder,
the voting at the meeting shall be conducted through necessary consent has been received from the
show of hands, unless a poll is demanded under Section Members.

172 Annual Report 2023-24

 Statutory Reports

EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013

ITEM NO. 2 ITEM NO. 3

Being into the business of NBFC, the Company requires Pursuant to Section 180(1)(a) of the Act, the Company is
more funds from various lenders of repute to run its required to create such charges, mortgages, lien, pledge,
operations smoothly and consistently. The Company has hypothecation and/or create security interest of every nature
outstanding borrowing of ` 3,130 crore (excluding Pass and kind in addition to the existing charges, mortgages,
Through Certificate (“PTC”) of ` 997 crore) as of June 2024. lien, pledge, hypothecation and/or create security interest
The Company has a plan to raise additional funding to the of every nature and kind, created by the Company, on such
tune of ` 4,000 - 4,500 crore in the form of debt through movable and/or immovable properties, including the whole
different instruments excluding PTC, as of Q1FY 2026. This or substantially the whole of the Company’s undertaking or
fresh borrowing estimates may take our exposure over the undertakings, both present and future, and in such manner
current approved limit of ` 4,000 crore. as the Board may deem fit, together with power to dispose
off the substantial assets of the Company in certain
As the business requirements of the Company is growing
events in favour of banks/financial institutions and their
at a fast pace and to enable an active borrowing program
subsidiaries, mutual funds, trust, other body corporates
by the Company and to meet the short term and long term
any other lenders (or any agent, security trustee, debenture
funding requirements of the Company and for onward
trustees or any other person acting on their behalf) for
lending by the virtue of the fact of ordinary course of
the holders of debentures/bonds/other instruments to
business and general corporate purposes of the Company,
secure inter-alia loan or financial facility/assistance from
the Company may consider undertaking different forms of
various banks, financial institutions and/or other lenders
borrowings including but not limited to term loans, working
and/or by way of issue of debentures/bonds/commercial
capital facilities, debentures/bonds/commercial papers/
papers/external commercial borrowings or such other
external commercial borrowings or such other instrument
instrument, etc. (hereinafter collectively referred to as the
with or without security, whether in India or outside India as
“Loans”) which may be issued on private placement basis
may be allowable to be mobilised by the Company. Since
or otherwise to secure the due payment of the principal
the existing approved limit is likely to get exhausted in near
together with interest, premium on pre-payment or on
future, it is proposed to increase the present borrowing
redemption, costs, charges, expenses and all other monies
limits from ` 4,000 crore (Indian Rupees Four Thousand
payable by the Company in respect of the said Loans for
crore only) to ` 7,000 crore (Indian Rupees Seven Thousand
which the charge is to be created, at present the Company
crore only) over and above the paid-up share capital, free
can incur up to ` 4,000 crore (Rupees Four Thousand crore
reserves and securities premium of the Company.
only).
Pursuant to Section 180(1)(c) of the Act, the Board of
Accordingly, it is proposed to seek approval of the Members
Directors or any Committee authorised by the Board shall
under Section 180(1)(a) of the Act, to authorise the Board
exercise the powers to borrow money, where the money to
of Directors to create such charges, mortgages, lien, pledge,
be borrowed, together with the money already borrowed
hypothecation and/or create security interest of every nature
by the Company will exceed aggregate of its paid-up share
and kind in addition to the existing charges, mortgages,
capital, free reserves and securities premium, apart from
lien, pledge, hypothecation and/or create security interest
temporary loans obtained from the Company’s bankers in
of every nature and kind, created by the Company, on such
the ordinary course of business only with the consent of the
movable and/or immovable properties, including the whole
Members of the Company by way of a Special Resolution.
or substantially the whole of the Company’s undertaking or
Accordingly, the Board of Directors of the Company, vide its undertakings, both present and future, and in such manner
resolution passed at the meeting held on August 12, 2024 as the Board may deem fit, together with power to dispose
has proposed to increase the borrowing limit, subject to off the substantial assets of the Company in certain
approval of the Members. events in favour of banks/financial institutions and their
None of the Directors, Key Managerial Personnel of the subsidiaries, mutual funds, trust, other body corporates
Company or their relatives is, in any way, concerned or any other lenders (or any agent, security trustee, debenture
interested in the resolution. trustees or any other person acting on their behalf) for the
purpose of securing the borrowing(s) of the Company for a
The Board of Directors of the Company recommends the sum equivalent to ` 7,000 crore (Rupees Seven Thousand
resolution set out as Item No. 2 of the Notice for approval crore only).
by the Members as a Special Resolution.

Aye Finance Private Limited 173

EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013 (CONTD.)

The Board of Directors of the Company, vide its resolution purposes and after accessing existing & future projections
passed at the meeting held on August 12, 2024 has proposed of the Company & to facilitate the Company to evaluate a
to create charge on movable and/or immovable properties potential fund raising at an appropriate time in one or more
of the Company, subject to approval of the members. tranches in Indian as well as overseas market by issue of
NCDs, consent of the Members of the Company is sought
None of the Directors, Key Managerial Personnel of the
in connection with the aforesaid issue of listed, secured/
Company or their relatives is, in any way, concerned or
unsecured/ subordinated/ unsubordinated/ senior, rated/
interested in the resolution.
unrated, perpetual/ non-perpetual, redeemable (including
The Board of Directors of the Company recommends the market linked debentures) cumulative/ non-cumulative
resolution set out as Item No. 3 of the Notice for approval NCDs and they are requested to authorise the Board
by the Members as a Special Resolution. (including any Committee thereof, which the Board may
have constituted/ authorised or hereinafter constitute to
ITEM NO. 4 exercise its powers including the powers conferred by this
resolution and with the power to delegate such authority to
Pursuant to the provisions of Section 42 of the Act, read
any person or persons) to issue such NCDs for a period of
with Rule 14 of the Companies (Prospectus and Allotment
1 (one) year on private placement basis up to ` 4,000 crore
of Securities) Rules, 2014, the Company can issue securities
(Rupees Four Thousand crore only), in one or more series/
including NCDs on a private placement basis subject to the
tranches on private placement basis within the limits
condition that the proposed offer of securities or invitation
permitted by the RBI and other regulatory authorities, if any,
to subscribe to the securities has been previously approved
to the eligible investors, during a period of 1 (one) year from
by the Members of the Company, by means of a special
the date of passing of this special resolution.
resolution, for each of the offer or invitation. In case of
an offer or invitation for NCDs, it shall be sufficient if the The said non-convertible debt securities would be issued by
Company passes a special resolution only once in a year for the Company in accordance with the applicable statutory
all the offer(s) or invitation(s) to subscribe to such NCDs on guidelines, for cash either at par or premium to face value
a private placement basis, during a period of 1 (one) year depending upon the prevailing market conditions and the
from the date of passing of the special resolution. pricing of such securities depends upon various factors
which may include prevailing risk free rates, competitor
In view of the above requirement, the Members of the
rates of similar rating and prevailing regulations.
Company at the last AGM held on September 29, 2023 had
approved the raising of funds by issue of NCDs on private Furthermore, the offer shall be made to such persons as
placement basis in pursuance of the relevant provisions of identified under Section 42 of the Act, on such terms and
the applicable laws and circulars or guidelines issued by the conditions including the price, coupon, par/ premium/
RBI, up to an amount not exceeding ` 3,000 crore (Rupees discount, tenor etc., as may be determined by the Board,
Three Thousand crore only), during a period of 1 (one) year in the prevailing market conditions as permitted by the
from the date of passing of the special resolution, in one or relevant applicable regulations.
more series/ tranches. The Board of Directors of the Company, vide its resolution
Currently the Company has outstanding NCDs amounting passed at the meeting held on August 12, 2024 has
to ` 1,348 crore as of June, 2024. The Company has a proposed the said issuance of NCDs on private placement
plan to raise additional funding through NCD issuances to basis, subject to approval of the members.
the tune of ` 1,500 - 2,000 crore in next 12 months. This None of the Directors, Key Managerial Personnel of the
fresh borrowing estimates may take our exposure over the Company or their relatives is, in any way, concerned or
current limit of ` 3,000 crore. interested in the resolution.
Accordingly, in order to augment resources for on-lending The Board of Directors of the Company recommends the
by the Company, repayment/ refinance of existing debt, resolution set out as Item No. 4 of the Notice for approval
working capital requirement, investments, general corporate by the Members as a Special Resolution.

By order of the Board

For Aye Finance Private Limited

Sd/-
(Vipul Sharma)
Place: Gurugram Company Secretary, Compliance Officer
Date: September 19, 2024 & Chief Compliance Officer

174 Annual Report 2023-24

NOTES
NOTES
 Aye Finance Private Limited
7th Floor, Unitech Commercial Tower 2,
Sector 45, Gurugram 122 003, Haryana