July 6, 2017

The Chairman/ Managing Director/
Chief Executive Officer
Small Finance Banks

Dear Sir/Madam,

Small Finance Banks – Compendium of Guidelines on Financial Inclusion and Development

In view of the announcement made in the budget 2014-15 regarding creation of a framework for licensing small banks, and to give a thrust to the supply of credit to micro and small enterprises, agriculture and banking services in unbanked and under-banked regions in the country, Reserve Bank decided to license new “Small Finance Banks (SFBs)” in the private sector. Following a due process, in-principle approvals were given to ten applicants to set up SFBs vide press release dated September 16, 2015.

2. Subsequently, Operating Guidelines for Small Finance Banks were issued vide Circular DBR.NBD.No.26/16.13.218/2016-17 dated October 6, 2016, which prescribed, inter alia, broad indicative guidelines in areas related to Financial Inclusion and Development. In continuation with the same, comprehensive set of guidelines in the form of a compendium is Annexed. The guidelines are operational with effect from the date of this compendium.

Yours faithfully,

(Uma Shankar)
Chief General Manager-In-Charge

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