Delhi High Court Upholds BharatPe Veto Rights in Unity SFB Dispute

The Delhi High Court has upheld an interim order restraining Unity Small Finance Bank (SFB) from unilaterally advancing a capital restructuring resolution. The court's decision prevents the bank's board from tabling or approving specific capital changes without the prior written consent of Resilient Innovations (RIPL), the parent company of BharatPe, and Centrum Financial Services.

The conflict arises from a 2021 shareholders' agreement that designated capital structure amendments as "Reserved Matters," requiring mutual consent from both major shareholders. BharatPe contested a proposal by Unity SFB to increase its authorized share capital, arguing that the resolution would dilute its 49% stake. The court affirmed that the bank must adhere to the governance framework established at its inception.

Unity SFB has maintained that the legal proceedings do not impact its daily operations or service to customers. Meanwhile, BharatPe has publicly called on the bank to honor its contractual obligations and maintain transparent governance. The outcome of this dispute remains significant as BharatPe works toward meeting regulatory requirements to reduce its stake in the bank to 10% by 2029.