Some of the names, experts believe, which can give a shot in the SFB space are Svatantra Microfin, Fusion Microfinance, Spandana Sphoorty Financial, Annapurna Finance and Satin Creditcare.
One non-banking financial company (NBFC) official told Business Standard, “Yes, I would consider this option (of an SFB) because it gives me access to deposits which I don’t have right now. But it is too early for us to say that we are going to apply for a licence. We are working on other things right now and will do a proper analysis before making any move.”
had earlier issued guidelines for licensing of SFBs in November 2014 that led to granting of in-principle approval to 10 applicants.
Out of these, eight were MFIs
and only AU Small Finance Bank was an NBFC. Capital Small Finance Bank was a local area bank in Punjab. Some market players also believe that the condition of completion of five years of operation to become an SFB is a bit stretched. However, the fact that SFBs open paths to universal banks is also assuring.
Mahesh Ramamoorthy, managing director, banking solutions, Fidelity Information Services, said, “The condition for a payments banks to complete five years of operations before seeking an SFB licence seems a bit long. The RBI’s reiteration that SFBs will have a path to a universal banking licence is a positive news.
It is too early to say if NBFCs and MFIs
will lap up the opportunity. But they will look at this because the biggest merit of an SFB licence is that it gives permission to take deposits.
“I don’t think anyone will jump on this, but yes, they should consider it. It gives them an edge. Right now, NBFCs want to focus on their own model rather than jumping ship and you have to agree that the SFB market is already very competitive,” said an expert.