Small Finance Banks in India- SFBs

small finance banks in india

Small Finance Banks in India- SFBs

Small Finance Banks are banks which offer necessary banking facilities like lending money and accepting deposits. They focus mainly on minor business units, marginal and small farmers, small and micro industries and unorganized sectors.

These banks are registered under the Companies Act of 2013 and licensed under Section 22 of the 1949 Banking Regulation Act.

The guidelines for operating small finance banks were started by RBI in 2014 and on 17th September 2015, provisional licenses were given to ten entities for converting themselves into small finance banks one of the Indian bank type . The minimum capital for a small finance bank has to be Rs 100 crore.

The main objectives

The primary objectives of Small Finance banks are as follows:

  • To offer savings vehicles to underserved and unserved sections of the society
  • To supply credit to marginal and small farmers, minor business units, small and micro industries, unorganized sectors at lower rates of interest.

Differences between Small Finance Banks and Payment Banks

  • Small Finance Banks have the right to give advances and loans, something that a payment bank cannot provide.
  • Small banks are mainly for the development of agriculture as well as micro, medium and small industries. Payment banks, on the other hand, mostly offer economic help to an individual belonging to the weaker section of the society.

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List of Small Finance Banks

1

AU Small Finance Bank

2

Capital Small Finance Bank

3

Equitas Small Finance Bank

4

ESAF Small Finance Bank

5

Fincare Small Finance Bank

6

Janalakshmi Small Finance Bank

7

North East Small Finance Bank

8

Suryoday Small Finance Bank

9

Ujjivan Small Finance Bank

10

Utkarsh Small Finance Bank