RBI issues SFB licence to Centrum-BharatPe consortium

'Unity Small Finance Bank' will start with at least Rs 1,500-cr loan book, says Centrum

The Reserve Bank of India (RBI) on Tuesday issued a small finance bank (SFB) licence to the Centrum Group-BharatPe consortium. Incorporated as Unity SFB, the lender will start operations in some weeks with a Rs 1,500-crore loan book.

The consortium will take over the assets and liabilities of the beleaguered Punjab and Maharashtra Co-operative (PMC) Bank. The timing for integrating PMC will depend upon when the RBI and the government release the scheme for amalgamation, said Jaspal Bindra, chairman of the BSE-listed Centrum Capital.
 
Bindra said with the RBI issuing an SFB licence, the focus will shift to board formation and creating a top management team. The bank will become functional before the close of this year and will aspire to be India’s first digital bank.
 
"We will work tirelessly to capture this opportunity and build India’s first truly digital bank ground-up," said Ashneer Grover, co-founder and managing director, BharatPe.

In June, the RBI gave “in-principle” approval to Centrum Financial Services (CFSL) to set up an SFB.

Centrum will merge its small and medium-sized enterprises lending business and micro-credit operations with the SFB for a consideration of Rs 426 crore. These businesses are run by two subsidiaries.

Bindra-led Centrum Capital, the holding entity for CFSL, and its partner BharatPe, a payments system company, will infuse Rs 1,800 crore into the SFB. BharatPe will also move its loan assets to Unity SFB.
 
The proposed business model is one of collaboration and open architecture, uniting all its stakeholders to deliver a seamless digital experience, added Bindra.