10 get nod for small banks

Mumbai: Seeking to promote financial inclusion, the RBI on Wednesday granted approval to 10 entities, including Ujjivan Financial Services and Equitas Holdings, to set up Small Finance Banks to provide basic banking services to small farmers and micro industries. 

 

Other entities to get the RBI’s nod are Au Financiers (Jaipur), Capital Local Area Bank (Jalandhar), Disha Microfin (Ahmedabad), ESAF Microfinance (Chennai), Janalakshmi Financial (Bengaluru), RGVN (North East) Microfinance (Guwahati), Suryoday Micro Finance (Mumbai) and Utkarsh Micro Finance (Varanasi). 

 

The in-principle approval has been granted within a month of RBI giving nod to 11 entities for launching Payments Banks. Besides, the RBI last year provided licences to two entities — IDFC and Bandhan — to operate full-fledged banks. 

 

Of them, Bandhan started operations last month while IDFC Bank is expected to go live next month. The RBI statement said that the “in-principle” approval will be valid for 18 months to enable these entities comply with the guidelines on Small Finance Banks. 

 

The Small Finance Banks can provide basic banking services like accepting deposits and lending to the unbanked sections such as small farmers, micro business enterprises, micro and small industries and unorganised sector entities.