BANKING AFFAIRS

Detailed explanation-1: -The decision to issue an in-principle approval for setting up of a bank will be taken by RBI. RBI’s decision in this regard will be final. The validity of the in-principle approval issued by RBI will be eighteen months from the date of granting such in-principle approval and would thereafter lapse automatically.

Detailed explanation-2: -The RBI would consider granting a licence for commencement of banking business under Section 22 (1) of the Banking Regulation Act, 1949, on being satisfied that the applicant has complied with the requisite conditions laid down by RBI as part of “in-principle” approval.

Detailed explanation-3: -On 19 August 2015, the Reserve Bank of India gave “in-principle” licences to 11 entities to launch payments banks. The “in-principle” license was valid for 18 months within which the entities must fulfil the requirements and they were not allowed to engage in banking activities within the period.

Detailed explanation-4: -It should have a minimum net worth of ₹500 crore. Its CRAR should not be less than 15%. The net NPAs of the bank should not exceed 6%, during previous four quarters. It should have made profit in the preceding two years.

Detailed explanation-5: -The Reserve Bank of India on Tuesday granted a banking licence to Unity Small Finance Bank Ltd (USFBL), which was established jointly by the Centrum Financial Services Ltd (CFSL) and Resilient Innovations Private Limited (BharatPe), to carry on a SFB business in India.