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Small Finance Bank License

Small Finance Bank License

Under Companies Act 2013,Small Finance Banks are registered as public limited company and are licensed under section 22 of the Banking Regulation,1949 and primarily governed by Banking Regulation Act,1949 and RBI Act,1934. Small Finance Banks were introduced with the purpose to serve rural and semi-urban areas like small businesses, unorganized areas, etc. They make money by collecting it from current and saving account depositors, fixed depositors, etc. Every small finance banks needs approval from RBI before opening of any new branch. It should extend 75% of its ANBC to the classified sectors under PSL by the RBI.

Our Small Bank Service Includes

Procedure to Establish a Small Finance Bank

Documentation required for a small finance bank

Liaising with the RBI for small finance bank license

End-to-end support

Main Objectives of a Small Finance Bank License

  • Provide framework to promote rural and semi-urban savings
  • Provide credit in local areas to carry out economic activities
  • Provide saving vehicles to the underprivileged sections of the society
  • By using hi-tech, low-cost technology, supply of credit to small businesses

Eligibility Criteria for Starting a Small Finance Bank

Documents Required

  • Copy of the Certificate of Incorporation of the Company
  • Information on the Directors and Shareholders related to the income earned by the respective individuals
  • Total income and net income earned by the directors and shareholders of the entity
  • Copy of the Memorandum of Association and Articles of Association (MOA and AOA) of the company
  • Certificate from the Banker related to No-Lien on the amount of funds (5 crore)
  • Respective Credit Report on the Directors and Shareholders
  • Professional and Educational Qualifications of the Directors
  • Bankers Report of the Status of the Company
  • Structure Plan of the Organisation
  • Information on the Services and Products which would be offered by the Bank

How to reach Finlaw for Small Finance Bank License