InvestorQ : What are small finance banks?
nishi Shah made post

What are small finance banks?

Answer
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seema Upadhyaya answered.
1 year ago


Small finance banks are a type of banks that operate in India, the other one being universal or the regular banks we know (such as State Bank of India, ICICI Bank, HDFC Bank, etc). The Reserve Bank of India grants two types of licenses to banks: the Universal Bank License and the Differentiated bank License.

Small finance bank is a differentiated or niche bank that provides banking services to a particular section or demographic of the society.

According to the Reserve Bank of India, the objectives of a small finance bank are to further financial inclusion by providing savings vehicle as well as credit supply to small business units; small and marginal farmers; micro and small industries; and other unorganised sector entities, through high technology-low cost operations.