2A. Material Accounting Policies

(1) Statement of compliance

The financial statements have been prepared in accordance with the provisions of the Companies Act, 2013
and the Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards)
Rules, 2015 (as amended from time to time) issued by the Ministry of Corporate Affairs in exercise of the powers
conferred by Section 133 of the Companies Act, 2013. In addition, the guidance notes/ announcements issued
by the Institute of Chartered Accountants of India (ICAI) are also applied along with compliance with other
statutory promulgations which require a different treatment. Any directions issued by the RBI or other regulators
are implemented as and when they become applicable.

The Company has complied with the disclosures as required by the Master Direction - “Reserve Bank of India
(Non-Banking Financial Companies - Registration, Exemptions and Framework for Scale Based Regulation)”
Directions, 2025 issued by the Reserve Bank of India (RBI) vide their Notification No. RBI/DOR/2025-26/339
DOR.FIN.REC.No.258/03.10.119/2025-26 dated November 28, 2025, as amended.

Accounting policies have been consistently applied except where a newly issued accounting standard is initially
adopted or a revision to the existing accounting standard requires a change in the accounting policy hitherto in
use.

(2) Basis of preparation

The financial statements have been prepared on a historical cost convention on the accrual basis except for
certain financial instruments which are measured at fair values as at the end of each reporting period as
explained in the accounting policies below.

Historical cost is generally based on the fair value of the consideration given in exchange for goods and
services. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date, regardless of whether that price is
directly observable or estimated using another valuation technique. In estimating the fair value of an asset or
a liability, the Company considers the characteristics of the asset or liability if market participants would take
those characteristics into account when pricing the asset or liability at the measurement date. Fair value for
measurement and/ or disclosure purposes in these financial statements is determined on this basis.

Fair value measurements are categorised into Level 1, 2, or 3 based on the degree to which the inputs to the
fair value measurements are observable and the significance of the inputs to the fair value measurement in its
entirety.

• Level 1 : Level 1 hierarchy includes financial instruments measured using quoted prices;

• Level 2 : The fair value of financial instruments that are not traded in an active market is determined using
valuation techniques which maximise the use of observable market data and place limited reliance on
entity specific estimates. If all significant inputs required to fair value an instrument are observable, the
instrument is included in level 2; and

• Level 3 : If one or more of the significant inputs is not based on observable market data, the instrument is
included in level 3.

(3 Presentation of financial statements

The Balance Sheet and the Statement of Profit and Loss and Statement of Changes in Equity are prepared and
presented in the format prescribed in the Division III to Schedule III to the Companies Act, 2013 (the 'Act') applicable
for Non-Banking Financial Companies (“NBFC”). The Statement of Cash Flows has been prepared and presented
as per the requirements of Ind AS 7, Statement of Cash Flows. The disclosure requirements with respect to items
in the Balance Sheet and Statement of Profit and Loss, as prescribed in Division III of Schedule III to the Act, are
presented by way of notes forming part of the financial statements along with the other notes required to be disclosed
under the notified accounting standards and the Stock Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015, as amended from time to time.

(4) Functional and presentation currency

These financial statements are presented in Indian rupees (Rs.) which is also the Company's functional currency. All
accounts are rounded-off to the nearest lakh with two decimals, unless otherwise stated.

(5) Use of estimates and judgements

The preparation of financial statements in conformity with Ind AS requires management to make estimates,
judgements and assumptions that affect the application of accounting policies and the reported amounts of assets
and liabilities (including contingent liabilities) and disclosures as of the date of the financial statements and the
reported amounts of revenue and expenses for the reporting period. Actual results could differ from these estimates.
Accounting estimates and underlying assumptions are reviewed on an ongoing basis and could change from period
to period. Appropriate changes in estimates are recognised in the periods in which the Company becomes aware
of the changes in circumstances surrounding the estimates. Any revisions to accounting estimates are recognised
prospectively in the period in which the estimate is revised and future periods.

(6) Key accounting judgements and key sources of estimation uncertainty

The preparation of financial statements in conformity with Ind AS requires that the management of the Company
makes estimates and assumptions that affect the reported amounts of income and expenses of the period, the
reported balances of assets and liabilities and the disclosures relating to contingent liabilities as of the date of the
financial statements. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates include useful lives of property, plant and equipment and intangible assets, expected credit
loss on loan books, future obligations in respect of retirement benefit plans, fair value measurement etc. Difference,
if any, between the actual results and estimates is recognised in the period in which the results are known.

2B. Other Accounting Policies:

(1) Revenue recognition

Revenue (other than those items to which Ind AS 109, Financial Instruments is applicable) is measured based
on the consideration specified in the contracts with the customers. Amounts disclosed as revenue are net
of goods and services tax ('GST') and amounts collected on behalf of third parties. Ind AS 115, Revenue
from Contracts with Customers outlines a single comprehensive model of accounting for revenue arising from
contracts with customers.

The Company recognises revenue from contracts with customers based on a five-step model as set out in
Standard.

Specific policies for the Company's different sources of revenue are explained below:

(a) Interest income:

Interest income from a financial asset is recognised when it is probable that the economic benefits will flow
to the Company and the amount of income can be measured reliably. Interest income is accrued on a time
proportionate basis, by reference to the principal outstanding and at the effective interest rate applicable.

The effective interest rate is the rate that exactly discounts the estimated future cash receipts through the
expected life of the financial asset to that asset's net carrying amount on initial recognition.

The interest income is calculated by applying the Effective Interest Rate (EIR) Method to the gross carrying
amount of non-credit impaired financial assets (i.e. at the amortised cost of the financial asset before
adjusting for any expected credit loss allowance). For credit-impaired financial assets the interest income
is calculated by applying the Effective Interest Rate (EIR) Method to the amortised cost of the credit-
impaired financial assets.

(b) Other financial charges :

Cheque bouncing charges, pre- payment charges, foreclosure charges and initial margin money etc. are
recognised on a point-in-time basis and are recorded when realised, since the probability of collecting
such monies is established when the customer pays.

(c) Dividend income :

Dividend Income is recognised once the unconditional right to receive the dividend is established (provided
that it is probable that the economic benefits will flow to the Company and the amount of income can be
measured reliably).

(d) Net gain or loss on fair value change :

Any differences between the fair values of the financial assets classified as fair value through the profit
or loss, held by the Company on the balance sheet date is recognised as an unrealised gain/ loss in the
statement of profit and loss. In cases there is a net gain in aggregate, the same is recognised in “Net gains
on fair value changes” under revenue from operations and if there is a net loss the same is disclosed under
“Expenses”, in the statement of profit and loss.

(e) Advisory fees and other income :

Advisory fees and Other Income are recognised when services are provided and it is highly probable that
a significant reversal of revenue is not expected to occur. The Company recognises such revenue from
contracts with customers based on a five-step model as set out in Ind AS 115.

(f) Income from de-recognition of assets :

Gains arising out of de-recognition transactions comprise the difference between the interest on the loan
portfolio and the applicable rate at which the transaction is entered into with the transferee, also known as
the right of excess interest spread (EIS). The future EIS basis the scheduled cash flows on execution of
the transaction, discounted at the applicable rate entered into with the transferee is recorded upfront in the
statement of profit and loss. EIS is evaluated and adjusted for ECL and prepayment.

(2) Property, plant and equipment (PPE)

Tangible property, plant and equipment are stated at cost less accumulated depreciation and impairment, if any.
The cost of an item of property, plant and equipment is recognised if it is probable that future economic benefits
associated with the item will flow to the company and the cost thereof can be measured reliably. All property,
plant and equipment are initially recognised at cost. Cost comprises the purchase price and any directly
attributable cost to bring the asset to its working condition for its intended use. Subsequent expenditure incurred
on assets put to use is capitalised only when it increases the future economic benefits/ functioning capability
from/ of such assets. Advances paid towards acquisition of property, plant and equipment, outstanding at each
balance sheet date is classified as capital advances under other non-financial assets and the cost of assets not
put to use before such date are disclosed under Capital work-in-progress.

Depreciation is recognised so as to write-off the cost of assets less their residual values over their useful
lives, using the straight-line method. The estimated useful lives, residual values and depreciation method are
reviewed at the end of each financial year, with the effect of any changes in estimate accounted for on a
prospective basis. Assets purchased during the year are depreciated on the basis of actual number of days the
asset has been put to use in the year. Total Asset Invoice costing Rs. 5,000 or less are fully depreciated in the
year of purchase.

Estimated useful life of assets is as below :

Changes in the expected useful life are accounted for by changing the depreciation period or methodology, as
appropriate and treated as changes in accounting estimates.

The management believes that these estimated useful lives are realistic and reflect fair approximation of the
period over which the assets are likely to be used.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits
are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement
of an item of property, plant and equipment is determined as the difference between the sales proceeds and the
carrying amount of the asset and is recognised in the statement of profit and loss.

(3) Intangible assets

Intangible assets are recognised when it is probable that the future economic benefits that are attributable to
the asset will flow to the enterprise and the cost of the asset can be measured reliably. Intangible assets are
stated at original cost net of tax/ duty credits availed, if any, less accumulated amortization, and cumulative
impairment. Direct expenses (including salary costs) and administrative and other general overhead expenses
that are specifically attributable to acquisition of intangible assets are allocated and capitalised as a part of the
cost of the intangible assets.

Intangible assets not ready for the intended use on the date of the balance sheet are disclosed as Intangible
assets under development.

Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated
amortisation and accumulated impairment losses. Amortisation is recognised on a straight-line basis over their
estimated useful lives. The estimated useful life and amortisation method are reviewed at the end of each
financial year, with the effect of any changes in estimate being accounted for on a prospective basis.

The estimated useful life of Software's is considered as 5 years.

An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or
disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between
the net disposal proceeds and the carrying amount of the asset, and are recognised in the statement of profit
or loss when the asset is derecognised.

(4) Impairment of tangible and intangible assets

The Company assesses at each balance sheet date whether there is any indication that an asset may be
impaired. If any such indication exists, the Company estimates the recoverable amount of the asset.

The recoverable amount is the higher of an asset's net selling price and its value in use. If such recoverable
amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less
than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as
an impairment loss and is recognised in the statement of profit and loss. A previously recognised impairment
loss is increased or reversed depending on changes in circumstances. However, the carrying value after
reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation/
amortisation if there were no impairment.

(5) Leases

The Company follows Ind AS 116, Leases for accounting for contracts which are in the nature of leases. Lease
liabilities are measured at the present value of the contractual payments due to the lessor over the lease term,
with the discount rate determined by reference to the rate inherent in the lease unless (as is typically the case)
this is not readily determinable, in which case the Company's incremental borrowing rate on commencement
of the lease is used. Variable lease payments are only included in the measurement of the lease liability if they
depend on an index or rate. In such cases, the initial measurement of the lease liability assumes the variable
element will remain unchanged throughout the lease term. Other variable lease payments are expensed in the
period to which they relate.

A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a
period of time in exchange for consideration.

Company as a lessee

The Company accounts for each lease component within the contract as a lease separately from non-lease
components of the contract and allocates the consideration in the contract to each lease component on the
basis of the relative stand-alone price of the lease component and the aggregate stand-alone price of the non¬
lease components.

The Company recognises right-of-use asset representing its right to use the underlying asset for the lease term
at the lease commencement date. The right-of-use assets are depreciated using the straight-line method from
the commencement date over the lease term. Right-of-use assets are tested for impairment whenever there is
any indication that their carrying amounts may not be recoverable. Impairment loss, if any, is recognised in the
statement of profit and loss.

The Company measures the lease liability at the present value of the lease payments that are not paid at the
commencement date of the lease. The lease liability is subsequently remeasured by increasing the carrying
amount to reflect interest on the lease liability, reducing the carrying amount to reflect the lease payments made
and remeasuring the carrying amount to reflect any reassessment or lease modifications or to reflect revised
in-substance fixed lease payments.

The Company recognises the amount of the re-measurement of lease liability as an adjustment to the right-
of-use asset. Where the carrying amount of the right-of-use asset is reduced to zero and there is a further
reduction in the measurement of the lease liability, the Company recognises any remaining amount of the re¬
measurement in the statement of profit and loss.

The Company has elected not to apply the requirements of the Standard to short-term leases of all assets that
have a lease term of 12 months or less and leases for which the underlying asset is of low value. The lease
payments associated with these leases are recognized as an expense on a straight-line basis over the lease
term.

Finance lease

The Company does not have leases that were classified as finance leases. Hence, there is no impact on
application of this standard.

As a lessor

The Company does not have any lease agreement in which it is a lessor. Hence, there is no impact on application
of this standard.

(6) Taxes

Income tax expense represents the sum of the tax currently payable, deferred tax and any excess/ short
provision of earlier years.

(a) Current tax

Current Tax is determined at the amount of tax payable in respect of taxable profit for the year as per the
Income tax Act, 1961. Taxable profit differs from 'profit before tax' as reported in the financial statement

of profit and loss because of items of income or expense that are taxable or deductible in other years and
items that are never taxable or deductible. The entity's current tax is calculated using tax rate that has
been enacted by the end of the reporting period.

(b) Deferred tax

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets
are generally recognised for all deductible temporary differences to the extent that it is probable that
taxable profits will be available against which those deductible temporary differences can be utilised.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in
which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted
or substantively enacted by the end of the reporting period.

The measurement of deferred tax liabilities and assets reflect the tax consequences that would follow
from the manner in which the Company expects, at the end of the reporting period, to recover or settle the
carrying amount of its assets and liabilities.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set-off the
current income tax assets against the current income tax liabilities and the deferred taxes relate to the
same taxable entity and the same taxation authority.

(c) Current and deferred tax for the year

Current and deferred tax are recognised in the statement of profit and loss, except when they relate to
items that are recognised in other comprehensive income or directly in equity, in which case, the current
and deferred tax are also recognised in other comprehensive income or directly in equity respectively.

(d) Minimum alternate tax (MAT)

Minimum alternate tax (MAT) paid in accordance with the tax laws, is recognised as an asset in the balance
sheet when it is probable that the future economic benefits associated with it will flow to the Company.

(e) Goods and Services Input Tax Credit

Goods and Services Input tax credit is accounted for in the books in the period in which the supply of
goods or service received is accounted and when there is no uncertainty in availing/utilising the credits.

(7) Employee Benefits

(a) Retirement benefit costs and termination benefits
Defined contribution plans -

Payments to defined contribution retirement benefit plans are recognised as an expense when employees
have rendered service entitling them to the contributions.

The state governed Provident Fund Scheme, Employee State Insurance Scheme and National Pension
Scheme (NPS) are defined contribution plans.

Defined benefit plans -

For defined benefit plans in the form of gratuity, the cost of providing benefits is determined using the
projected unit credit method, with actuarial valuations being carried out half yearly. Remeasurements,
comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net
interest on the net defined benefit liability and the return on plan assets, are recognised immediately in
the Balance Sheet with a corresponding debit or credit to retained earnings through OCI in the period in
which they occur. Past service cost is recognised in the statement of profit and loss in the period of a plan
amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the
net defined benefit liability or asset. Defined benefit costs are categorised as follows:

• service cost (including current service cost, past service cost, as well as gains and losses on
curtailments and settlements);

• net interest expense or income; and

• re-measurement

The Company presents the first two components of defined benefit costs in the statement of profit and
loss in the line item 'Employee benefits expense'. Curtailment gains and losses are accounted for as past
service costs.

In case of funded plans, the fair value of the plan assets is reduced from the gross obligation under the
defined benefit plans to recognise the obligation on a net basis.

The present value of the defined benefit plan liability is calculated using a discount rate which is determined
by reference to market yields at the end of the reporting period on government bonds.

(b) Short term and other long-term employee benefits

A liability is recognized for benefits accruing to employees in respect of salaries and annual leave in the
period the related service is rendered at the undiscounted amount of the benefits expected to be paid in
exchange for that service.

Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount
of the benefits expected to be paid in exchange for the related service.

Liabilities recognized in respect of other long-term employee benefits are measured at the present value
of estimated future cash outflows expected to be made by the Company in respect of services provided by
employees up to the reporting date.

The cost of short-term compensated absences is accounted as under:

(i) in case of accumulated compensated absences, when employees render the services that increase
their entitlement of future compensated absences; and

(ii) in case of non-accumulating compensated absences, when the absences occur.

(c) Compensatory Payments (Loss of Earned Bonus)

The company amortizes the compensatory payments over the period of twelve months, since the amount
is recoverable if an employee leaves the organization within a year.

(d) Share-based Payment

The Company recognises compensation expense relating to share-based payments in the statement of
profit and loss using fair value in accordance with Ind AS 102, Share-based payment. The estimated
fair value of the award is charged to income on a straight-line basis over the requisite service period
for each separately vesting portion of the award as if the award was in-substance multiple awards with
a corresponding increase to share options outstanding amount. The share price of the Company was
simulated using a binomial model. The simulation was done from each valuation date to maturity of the
ESOP.

Equity-settled share-based payments to employees and others providing similar services are measured at
the fair value of the equity instruments at the grant date.

The fair value determined at the grant date of the equity-settled share-based payments is expensed on a
straight-line basis over the vesting period, based on the Company's estimate of equity instruments that will
eventually vest, with a corresponding increase in equity. At the end of each reporting period, the Company
revises its estimate of the number of equity instruments expected to vest. The impact of the revision of
the original estimates, if any, is recognised in the statement of profit and loss such that the cumulative
expense reflects the revised estimate, with a corresponding adjustment to the equity-settled employee
benefits reserve. If a grant lapses after the vesting period, the cumulative discount recognised as expense
in respect of such grant is transferred to the retained earnings within equity and if the grant lapses before
the vesting period, the cumulative discount recognised as expense in respect of such grant is credited to
the statement of profit and loss.

Equity-settled share-based payment transactions with parties other than employees are measured at the
fair value of the goods or services received, except where that fair value cannot be estimated reliably, in
which case they are measured at the fair value of the equity instruments granted, measured at the date the
entity obtains the goods or the counterparty renders the service.

(8) Finance costs

Finance costs include interest and other ancillary borrowing costs. Ancillary costs include issue costs such
as loan processing fees, arranger fees, stamping expense and rating expense etc. The Company recognises
interest expense and other ancillary costs on the borrowings as per Effective Interest Rate Method (EIR) which
is calculated by considering any ancillary costs incurred and any premium payable on its maturity.

Finance costs are charged to the statement of profit and loss.