List of Small Finance Banks in India

Academy   Last Update - 2023-09-14

What is a Small Finance Bank?

Small Finance banks are physical banks whose aim is to provide basic banking products such as deposits and supply of credit but in a limited area of operation. Small banks are expected to meet the credit and remittance needs of small businesses, farmers, micro and small industries, unorganised sector, low-income households and the migrant workforce through high technology cost operations.

List of small finance banks in India-

Name of the Small Financial bank	Headquarters	Tagline
Au Small Finance Bank Limited(AUBANK)	Jaipur, Rajasthan	Chalo Aage Badhe
Capital Lab Small Finance Bank	Jalandhar, Punjab	Viswas se Vikas take
Equitas Small Finance Bank	Chennai, Tamilnadu	It is Fun Banking
ESAF Small Finance Bank	Thrissur, Kerala	Joy of Banking
FINCARE Small Finance Bank Limited(formed from Disha Microfin Limited)	Bengaluru, Karnataka	a new era in smartbanking begins
Janalakshmi Small Finance Bank	Bengaluru, Karnataka	Likho Apni Kahaani
North East Small Finance Bank (NESFB) - RGVN Micro Finance Ltd.	Guwahati, Assam	Your Doorstep Banker
Suryoday Small Finance Bank	Navi Mumbai	A bank of smiles
Ujjivan Small Finance Bank	Bengaluru, Karnataka	We believe in your belief
Utkarsh Small Finance Bank	Varanasi, U.P	Aapki Umeed Ka Khata

Important features of Small Banks:

• They can accept any deposit (savings, current, fixed deposits, recurring deposits) like commercial banks.
• Unlike payment banks, small finance banks will be allowed to lend money also.
• For the initial 3 years, prior approval will be required for branch expansion.
• To give the feel of a local bank, their area of operation will be restricted.
• NBFCs, any individual with 10 years of experience in banking can apply for licenses.
• Their target are small businesses and MSMEs.
• They are not allowed to lend the deposited money to big businesses or industries.

Some of the conditions for setting up a Small Bank:

• Minimum paid-up equity capital requirement of Rs 100 crore.
• Every small finance bank must have the words small finance bank in its name.
• They cannot set up subsidiaries to undertake non-banking financial service activities.
• 75% of its Adjusted Net Bank Credit (ANBC) should be advanced to the priority sector as categorized by RBI.
• Maximum loan size to a single person cannot exceed 10% of total capital funds; and cannot exceed 15% in the case of a group.
• At least 50% of its loans should constitute loans and advances of up to 25 lakh.
• Small banks can undertake financial services like the distribution of mutual fund units, insurance products, pension products, and so on, but not without prior approval from the RBI.
• A small bank can transform into a full-fledged bank, but only after RBI approval.
• A fundamental requirement is that it must have 25% of its branches set up in unbanked areas.
• ​List of Banks in India​

Academy

Share on Facebook Twitter LinkedIn