ESAF applies for small bank license

The company meets RBI criteria and also has branches in nine states that serve more than 700,000 clients

Thrissur-headquartered ESAF Microfinance has applied for the small finance bank licence.

ESAF Microfinance meets most of the criteria spelt out by the Reserve Bank, including the promoter’s capital in small finance banks, the company said. It has branches across nine states and is serving more than 700,000 clients.

K Paul Thomas, founder and chairman and managing director of ESAF said small finance bank status would help the organisation meet the much-needed demand for lending more than Rs 50,000, especially to micro enterprises, small businesses, agriculture and allied sectors.

He added as a class of institutions, MFIs were best-suited to meet the stated policy goals of financial inclusion. ESAF has presence across rural areas of Jharkhand, Chhattisgarh, Maharashtra and Madhya Pradesh. Plans are on the anvil to expand operations to Northeast.

Dia Vikas Capital, a subsidiary of Opportunity International, Australia, and Maanaveeya Holdings, a subsidiary of Oiko Credit Netherlands, are the two major social investors in ESAF.