“Au Small Finance Bank Limited has commenced operations as a small finance bank with effect from April 19, 2017,” said the Reserve Bank of India (RBI), in its official communiqué.
The RBI said it has issued a licence to the bank under the Banking Regulation Act, 1949, to carry out the business of small finance bank in India, reported the India Today.
Au Financiers (India) Limited was one of the ten applicants that received in-principle approval from the central bank on September 16, 2015, for setting up small finance banks.
Among those, Capital Small Finance Bank, Equitas Small Finance Bank, Utkarsh Micro Finance, Suryoday Microfinance, Ujjivan Small Finance Bank and ESAF Small Finance Bank have already commenced their operations.
Small finance banks provide basic banking services like accepting deposits and lending to unserved and underserved including small business units, small and marginal farmers, micro and small industries and unorganised sector entities.