RBI has recently announced the names of applicants under its on-tap licensing window for universal banks and Small Finance Banks (SFBs).
Applicants under guidelines for on-tap licensing of universal banks are Repatriates Cooperative Finance and Development Bank (Repco Bank), UAE Exchange and Financial Services, Chaitanya India Fin Credit, and Pankaj Vaish and others. Applicants seeking licences for SFBs are Calicut City Service Co-operative Bank, VSoft Technologies, Akhil Kumar Gupta, and Dvara Kshetriya Gramin Financial Services.
The universal bank licensing guidelines state that resident individuals and professionals having 10 years of experience in banking and finance at a senior level are eligible to promote universal banks. Large industrial houses are excluded as eligible entities but are permitted to invest in the banks up to 10%. Non-Operative Financial Holding Company (NOFHC) has been made non-mandatory in case of promoters being individuals or standalone promoting/converting entities who/which do not have other group entities.
For SFBs, the minimum paid-up voting equity capital / net worth requirement shall be Rs. 200 crore. For primary (urban) co-operative banks (UCBs) desirous of voluntarily transiting into SFBs, the initial net worth requirement shall be at Rs. 100 crore, which will have to be increased to Rs. 200 crore within 5 years from the date of commencement of business. The net worth of all SFBs currently in operation is in excess of Rs. 200 crore.