The name of the applicants that have been granted the licence include- Au Financiers, Capital Local Area Bank , Disha Microfin, Equitas Holdings, ESAF Microfinance and Investments, Janalakshmi Financial Services, RGVN (North East) Microfinance, Suryoday Micro Finance, Ujjivan Financial Services and Utkarsh Micro Finance.
The in-principle approval granted by RBI will be valid for a period of 18 months.
Small Finance Banks will be similar to the existing commercial lenders and will undertake basic banking activities of accepting deposits and lending to unserved and under-served sections. The maximum loan size and investment limit exposure to single and group obligators cannot be more than 10 per cent and 15 per cent of its capital funds, respectively.
Apart from this, at least 50 per cent of their loan portfolio has to include loans and advances of up to Rs 25 lakh, as per RBI regulations. 72 applicants have applied for Small Finance Banks. The regulator had also said that small banks can convert themselves into universal banks, though the transition would not be automatic and will depend on the regulator’s approval.