North East Small Finance Bank to help in financial inclusion in Northeast
RGVN (North East) Microfinance Limited will start the North East Small Finance Bank from June first week as the region’s first small finance bank. The Reserve Bank granted license to RGVN (North East) Microfinance Limited to start the services on March 31, paving way for a region-specific bank which aims to help in greater financial inclusion.
Announcing the first such initiative in the Northeast, RGVN (NE) MFL informed that they received the in-principle approval from RBI in October 2015 to set up a small finance bank. SIDBI venture capital infused Rs 40 crore, RNT Associates invested Rs 40 crore and PI Venture LLP invested Rs 20 crore in the venture. With these investments, the promoter, RGVN (NE) MFL, is now domestically owned, as required.
SIDBI has also proposed an equity infusion of 15 crore. Prior to these, RGVN (NE) MFL already had investments from Dia Vikas, Oiko credit Netherlands, NEDFi & SIDBI. Among the foreign investors, NMI is investing an additional Rs 15 crore and Dia Vikas Rs 7 crore. NESFB is now testing the core banking software in which all the 4.07 lakh clients of RGVN (NE)MFL will be on-boarded, a statement said.
The entire exercise will be completed and the bank will be ready to launch by first week of June, the spokesperson further added.
RBI has approved 164 branch offices spread across 9 states, including 8 states from Northeast and West Bengal, thereby ensuring financial inclusion for all. “We shall be opening all the 164 branches in a phase-wise manner. These 164 branches also include interior areas of BTAD, Karbi Anglong, Nagaland, Arunachal Pradesh, Sikkim, Manipur, Mizoram, Meghalaya and Tripura – many presently out of reach of the banking network,” the statement further said.
With a view to carry forward the mission of financial inclusion, and to provide financial services at affordable rates to the underprivileged, under-banked and unbanked people in India, NESFB said that they are marching ahead to launch its bank branches soon. The bank is planning to achieve a business of Rs 1,100 crore by March 2018 and ramp up to Rs 2,000 crore of business in 2 years’ time.
NESFB has planned for various liability products including daily/weekly deposit accounts, fixed deposit a/c, savings account, current account, etc. with competitive interest rates for the benefit of our clients.
The bank has received approval from RBI for 3 directors – Deep Joshi as chairman of NESFB, Rupali Kalita as MD-CEO and Ranjit Goswami as an independent director.