Hotline: 1800 102 2007
X
Search Business Opportunities
2014-07-22

RBI sets Rs 100 crore floor capital for small banks, payment banks

The RBI has recently issued draft guidelines for setting up of \\\'local feel\\\' small banks, which will disburse small-ticket loans to farmers and businesses.

The Reserve Bank of India (RBI) has recently issued draft guidelines for setting up of 'local feel' small banks, which will disburse small-ticket loans to farmers and businesses.

 

The central bank also issued draft guidelines for setting up of payment banks, which will cater to marginalised sections of society, including migrant labourers, for collecting deposits and remitting funds.

 

Such banks can be set up with a minimum capital of Rs 100 crore as against Rs 500 crore required for normal commercial banks, according to the guidelines.

 

"Both payments banks and small banks are ‘niche’ and 'differentiated' banks, with the common objective of furthering financial inclusion," the RBI said while issuing draft guidelines for licensing of payments banks and small banks.

 

The proposed small banks will provide a whole suite of basic banking products such as deposits and supply of credit, but in a limited area of operation, it said.

 

On the other hand, payments banks will offer a limited range of products such as acceptance of demand deposits and remittances of funds. They will have a widespread network of access points particularly in remote areas, either through their own branch network or through Business Correspondents (BCs) or through networks provided by others.

 

Foreign investments in these new category banks would be as per the FDI policy.

 

The existing non-bank pre-payment instrument issuers, non-banking finance companies (NBFCs), corporate BCs, mobile telephone companies, super-market chains, companies, real sector cooperatives and public sector entities may apply to set up a payments bank.

 

In case of small banks, resident individuals with 10 years of experience in banking and finance, companies and Societies will be eligible as promoters to set up small banks.

 

NBFCs, micro finance institutions (MFIs), and Local Area Banks (LABs) can also opt for conversion into small banks.

 

"Preference will be given to professionals from banking or financial sector, NBFCs and MFIs to set up small banks, if they meet the 'fit and proper' criteria," the draft said.

 

Local focus and the ability to serve smaller customers will be a key criterion in licensing such banks, it said.

 

"The area of operations of the small bank will normally be restricted to contiguous districts in a homogeneous cluster of States/Union Territories so that the bank has the 'local feel' and culture," it said, adding, the bank may be allowed to expand in one or more states with geographical proximity.

Related opportunities
  • About Us: Pots and Pans, Launched promoted in India by Meyer..
    Locations looking for expansion New Delhi
    Establishment year 1997
    Franchising Launch Date 2018
    Investment size Rs. 10lac - 20lac
    Space required 500
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater DELHI New Delhi
  • EmployRoll, an industry leading SaaS product introduced by Thimbmatic Solutions..
    Locations looking for expansion Delhi
    Establishment year 2017
    Franchising Launch Date 2018
    Investment size Rs. 20lac - 30lac
    Space required 600
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater New delhi Delhi
  • About Us: Cambridge Montessori Pre School and Day Care is poised..
    Locations looking for expansion New Delhi
    Establishment year 2016
    Franchising Launch Date 2016
    Investment size Rs. 5lac - 10lac
    Space required 3000
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater Central Delhi New Delhi
  • Others Food Service
    About :  Eggsplore is a rising chain of themed fast food..
    Locations looking for expansion Maharashtra
    Establishment year 2017
    Franchising Launch Date 2018
    Investment size Rs. 10lac - 20lac
    Space required 300
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater Mumbai Maharashtra
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