Hotline: 1800 102 2007
X
Search Business Opportunities
2014-04-03

Bandhan becomes the first MF institution to get banking licence from RBI

Bandhan Financial Services, the first microfinance institution in the country to win a bank licence, is also one of the youngest entities to be allowed to enter the banking space

Bandhan Financial Services, the first microfinance institution in the country to win a bank licence, is also one of the youngest entities to be allowed to enter the banking space. 


The Reserve Bank of India granted "in-principle" approval for banking licences to infrastructure financing firm IDFC and Bandhan from among 25 applicants, including corporate heavyweights ADAG Group, Aditya Birla Group and Bajaj Group. 

 

Bandhan was the only microfinance institution that applied for a banking licence. 

 

Set up in 2001 by Chandra Shekhar Ghosh, Kolkata-based Bandhan began with a focus on working with "socially disadvantaged and economically exploited women," according to its website.

 

With 2,016 branches across 22 states and Union territories, Bandhan had over 52.33 lakh borrowers as of February. It disbursed Rs 963 crore of loans in February and has total loans outstanding of Rs 5,704 crore.

 

The RBI said it assessed the quantitative and qualitative aspects of the applicants, including their financial statements, 10-year track record of running businesses, proposed business model for the bank and demonstrated capabilities for running a bank, plan for expanding inclusion, and culture of compliance and integrity. 

 

Bandhan said the award of the banking licence was recognition of the microfinance sector and their hard work to reach unbanked areas and provide financial services. 

 

"We will be able to offer full-fledged banking services to the poor people," Bandhan, Chairman and Managing Director, Ghosh said.

 

Microfinance institutions had come under government scrutiny in 2010 after allegations that their strong-arm recovery tactics had led to a spate of suicides by borrowers.

 

The Andhra Pradesh Micro Finance Institutions (Regulation of Money lending) Act, 2010, was passed to ensure that the state government had oversight on the sector. The Act massively hit the microfinance business in Andhra Pradesh, which accounted for almost 30 per cent of the total of Rs 30,000 crore in the country. 

 

In July 2012, the RBI said that Andhra Pradesh Act has no jurisdiction over microfinance institutions registered as non-banking financial companies (NBFC) but only on non-NBFC MFIs. Subsequently, the Micro Financial Sector Development and Regulation Bill, 2011, were cleared and micro-lenders were brought under the ambit of the central bank. 

 

Bandhan has loan schemes such as Samriddhi for the MSME sector and Sushiksha for education, among others. It also runs the Bandhan School of Development Management.

Related opportunities
  • Fine Dine Restaurants
    About Us  The Grand Thakar`s family restaurant is a popular eating..
    Locations looking for expansion Gujarat
    Establishment year 1965
    Franchising Launch Date 2017
    Investment size Rs. 1 Cr. - 2 Cr
    Space required 500
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater Ahmedabad Gujarat
  • Quick Service Restaurants
    About: Upper Crust Foods Pvt. Ltd. is a 5-year-old company which..
    Locations looking for expansion Delhi
    Establishment year 2011
    Franchising Launch Date 2017
    Investment size Rs. 50lac - 1 Cr.
    Space required 400
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater New delhi Delhi
  • Non Banking Financial Company (NBFC)
    GOLDCASH LIMITED – A Premium Business Opportunity with Promising Returns.. About us: Go..
    Locations looking for expansion Odisha
    Establishment year 2016
    Franchising Launch Date 2018
    Investment size Rs. 20lac - 30lac
    Space required 200
    Franchise Outlets -NA-
    Franchise Type Unit, Multiunit
    Headquater Bhubaneswar Odisha
  • Beauty Salons
    About: Waves is a well-established and renowned chain of salons &..
    Locations looking for expansion Delhi
    Establishment year 2013
    Franchising Launch Date 2017
    Investment size Rs. 20lac - 30lac
    Space required 600
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater New delhi Delhi
Insta-Subscribe to
The Franchising World
Magazine
For hassle free instant subscription, just give your number and email id and our customer care agent will get in touch with you
OR Click here to Subscribe Online
Daily Updates
Submit your email address to receive the latest updates on news & host of opportunities

Free Advice - Ask Our Experts