RGVN Microfinance (North East) Ltd is gearing up to commence its small finance operations by mid-January. It is awaiting the final approval to open its small finance bank.
Guwahati-headquartered RGVN is intending to add 32 more branches to its current tally of 132 branches of the company by next March. All branches will be converted into full-fledged bank branches only by fiscal 2018. T
he company is operational in Assam, Arunachal Pradesh, Meghalaya, Nagaland, Tripura and Sikkim, and going ahead plans to open branches in Mizoram.
As per sources, RGVN is the only microfinance firm from the north-east to receive an in-principle approval to set up a small finance bank. Currently, RGVN operates in Assam, Arunachal Pradesh, Meghalaya, Nagaland, Tripura and Sikkim, and plans to open branches in Mizoram.
In this regard, earlier this month, the RBI issued operating guidelines for small finance banks which stated that the banks need to maintain a capital adequacy ratio of 15%. Both tier-I capital, or core capital, and tier-II capital will have to be 7.5% each. Capital adequacy ratio is a measure of a bank’s financial strength, expressed as a ratio of capital to risk-weighted assets.
The bank licence holders must start banking operations latest by March 2018. So far, only Capital Small Finance Bank and Equitas Small Finance Bank have taken off.
Disha Microfin Pvt. Ltd, Ujjivan Financial Services, Janalakshmi Financial Services Ltd, AU Financiers (India) Ltd, ESAF Microfinance and Investments Pvt Ltd, RGVN (North East) Microfinance Ltd, Suryoday Microfinance Pvt Ltd and Utkarsh Micro Finance Pvt. Ltd are all in various stages of readiness for their small finance banks.
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