BANKING AFFAIRS

Detailed explanation-1: -Capital Small Finance Bank Limited started operations as India’s 1st Small Finance Bank on April 24, 2016 after conversion from Capital Local Area Bank. Prior to conversion to a Small Finance Bank, Capital Local Area Bank was operating as India’s largest local area bank since January 14, 2000.

Detailed explanation-2: -Capital Small Finance Bank (erstwhile Capital Local Area Bank) is the India’s first small finance bank founded in April 2016 as a microfinance lender, with its headquarters in Jalandhar, India.

Detailed explanation-3: -The small finance bank will be required to use the words “Small Finance Bank” in its name in order to differentiate it from other banks. The minimum paid-up equity capital for small finance banks shall be Rs. 100 crore.

Detailed explanation-4: -The Reserve Bank had issued the Guidelines for Licensing of “Small Finance Banks” in the Private Sector on November 27, 2014. The process of licensing culminated in granting in-principle approval to ten applicants and they have since established the banks.