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From a newspaper editor to former bankers and tech chief finance officers, the individual applicants for the proposed small banks and payments banks are a bunch of enthusiastic investors,who say they want to make the best of the opportunity opened by the Reserve Bank of India (RBI).
Kiran Thakur, editor and banker
Kiran D Thakur, 62, is editor of Tarun Bharat, a Marathi daily published from Belagavi (former Belgaum) in Karnataka and from other centres in Maharashtra. Recently, he applied to RBI for a small finance bank licence.
He made news two years ago, when summoned by the Speaker of the Karnataka Legislative Assembly on a breach of privilege complaint made by two members. Though found guilty, he was let off by the Assembly after a public apology.
Thakur started as a sports reporter in 1968 and took over as editor of the daily in 1979. He transformed it from a single-location publication to multi-city editions. The daily is now published from Belagavi, Sangli, Satara, Kolhapur, Sindhudurg, Ratnagiri and Goa. In 1987, he also launched Newslink, an English daily.
Thakur has also established his name in the fields of education and cooperatives. He is an active member of Belgaum Jilha Prathamik Shikshan Samitee, which runs schools and colleges, and is a member of the Indira Gandhi Open University Centre at Belgaum, among others.
Thakur's love for banking started after he set up Lokmanya Multipurpose Co-op Society, said to be India's first multi-state, multi-purpose cooperative financial institution. It has 169 branches and a deposit base of about Rs 1,800 crore. The Society offers deposits and loans for housing, hypothecation, mortgages and for industrial and personal purposes. It also acts as a distribution agent for general and life insurance companies.
Collin Timms, banker with a vision
Collin Timms, an applicant for a small finance bank licence, says he's confident of securing one as he already runs a cooperative bank, Guardian Bank in Bengaluru, and an 'Opportunity Microfinance Institution'. Both together have equity capital of Rs 106 crore and have been operating for 15 years. The additional capital needed for the small finance bank will be brought in by the existing shareholders of the two entities.
"We have been working in the area of lending for a long time and have the required expertise. A small finance bank will give us an opportunity to operate on a national footprint. It will help us to continue with the work we are doing but on a much larger scale and will allow us to expand into other geographies," said Timms.
Adding: "RBI's idea behind these niche banking licences is to further financial inclusion. We believe we have a good chance to get the licence, as we have already been doing similar work. We can take the resources and learning from our existing operations and convert it into a small finance bank."
The profit after tax of Guardian Bank at end-March 2014 was Rs 13.86 crore.
K Cherian Varghese, 2nd innings
For a person who vetted plans to salvage sick business units in his previous assignment as chairman of an asset reconstruction agency, thinking to start a new small finance bank could seem quite a challenge. However, doing something new is not a departure for soft-spoken K Cherian Varghese, former chairman and managing director of Union Bank of India and Corporation Bank
After retirement, he pursued his academic interest and got doctorate in business policy and administration from Mumbai University in 2011. Starting as a banker in 1970, with Indian Bank, he worked on assignments in the priority sector, merchant banking and foreign exchange. Besides heading two public sector banks (Corporation Bank and Union Bank of India), two restructuring assignments would stand him in good stead for nurturing a baby. One of those involved resurrecting a bank in Indonesia and another was rebuilding South Indian Bank.
Varghese says he'd like to put his experience to use for social change. While giving services to people in a sustainable manner, the enterprise should recover costs and generate a surplus. Born and brought up in a small village in Kerala, he says he knows the requirements of people.
Asked about his business plans, Varghese prefers to say less. "At present, it is between me and RBI. So, I should not be talking about it." The capital, he says, will follow.
CFOs turned bankers
It's perhaps the first time when three former chief financial officers (CFOs) of two large information technology (IT) companies are joining hands to launch a bank. Which, they say, they want to position differently from those already operational.
The three finance veterans are V Balakrishnan (pictured), a former CFO at Infosys Technologies; Suresh Senapaty, the CFO of India's third largest IT services company, Wipro, set to retire from the company in April; and T V Mohandas Pai, also a former CFO of Infosys and now chairman of Manipal Education.
They've joined hands with a company owned by Kolkata-based engineering and consulting company Dastur & Co. They have applied to start a small bank with an initial capital requirement of Rs 100 crore. The three of them together would contribute half the overall funding requirement; Dastur & Co will bring in the rest.
"Technology is changing all sectors and we believe banking is also ripe to take part in this transformation. The idea is to start a technology-driven bank, with less of physical branches and people. It will be similar to a virtual bank but with much less of physical touch points. We want to really make a differentiation in the banking industry," said Balakrishnan, also a co-founder and chairman of the Exfinity venture capital fund.
"Once approved by the RBI, after a gap of over 100 years, Bengaluru will see the emergence of a new bank with headquarters in the city," he added.
Balakrishnan, Pai and Senapaty are also all certified chartered accountants. Together, they've over six decades of experience in the financial domain.
Vinod Jain, CA to banker
A surprise among the names that have applied for a small finance bank is a chartered accountant from Delhi. Vinod Jain started as a CA, in a small office in Nehru Place, a commercial complex in south Delhi, known for pirated software and assembling of computers.
Jain now heads INMACS, a member of the National Stock Exchange and a depository participant, and INMACS Management Services, which has a office in Gurgaon with about 100 people. The low-key Jain's emergence in the race for a license surprised many but people in the CA community say he's known to keep his cards close to his heart and spring surprises.
It is not clear how many investors Jain- a former member of the Institute of Chartered Accountants of India Council, apex decision making body for the profession - might rope in, provided he gets RBI's nod. It is learnt a sizable investment could come from Jain's own assets.
INMACS is known for services such as consulting and auditing. It also has an arm providing capital market services. INMACS is registered with the Securities and Exchange Board of India as a category-IV merchant banker. It provides Initial Public Offer advisory services and a wide array of other financial services - arrangement of term loans at competitive terms, working capital facilities, foreign currency loans from banks or financial institutions abroad. Jain did not respond to calls made by Business Standard.
Manish Khera, setting a new bar
After heading a company working on financial inclusion, a dream to build a small finance bank seems a natural extension for Manish Khera, a former banker.
He started with ICICI Bank and became chief executive of Financial Inclusion Network & Operations Ltd (FINO) in 2006. FINO is developing a low-cost platform to extend banking services to the under-banked. It had become important as the government and regulator began a push for such financial services.
He quit FINO in December 2013 to strike out on his own in the financial inclusion space and set up a technology company called YTS Solutions, to develop and deploy mobile-based prepaid payment solutions for operators and financial institutions.
Khera has teamed with finance sector professionals for a small finance bank licence. The entity, to be named 1st Small Finance Bank, will have an initial capital base of Rs 150 crore and primarily focus on underserved regions in central India.
Ajay Singh Bimbhet; cashing in on new opportunities
Ajay Singh Bimbhet is managing director at Royal Sundaram Alliance Insurance Company since 2007. Prior to this, he was MD and head, private and business clients at Deutsche Bank. He has about three decades of retail banking experience with majors such as ANZ Grindlays, Standard Chartered Bank and IDBI Bank. At IDBI, he was acting chief executive and country head, retail banking. His postgraduate degree was from the Delhi School of Economics in 1976.
He has applied for a small finance bank licence, with some other partners. He declined to share his plans for the venture.
