Annapurna Finance applies for licence to set up universal bank

The Reserve Bank on Wednesday said it has received an application from Bhubaneswar-based Annapurna Finance for setting up a universal bank.

During the quarter ended December 31, 2022, the Reserve Bank of India (RBI) received one application under the Guidelines for on tap Licensing of Universal Banks in the Private Sector dated August 1, 2016, the central bank said in a statement.

Annapurna Finance, according to the companys website, was established in 2009, and is one of the top 10 NBFC-MFIs in the country.

It provides loans to economically weaker sections of the society with a view to bringing them to the mainstream banking system.

As per the RBIs on tap licensing guidelines, the initial minimum paid-up voting equity capital for a universal bank should be Rs 500 crore. Thereafter, the bank should have a minimum net worth of Rs 500 crore at all time.

In April 2014, the RBI had given in-principle approval to Bandhan Bank Ltd and IDFC Bank to start universal banking operations. IDFC Bank has since merged with Capital First Ltd to form IDFC First Bank.

The RBI in 2021 had announced a five-member Standing External Advisory Committee, headed by former RBI deputy governor Shyamala Gopinath, for evaluating applications for universal banks and small finance banks.

Revathy Iyer, Director, Central Board, RBI; B Mahapatra, former Executive Director, RBI; T N Manoharan, former president, ICAI; and Hemant G Contractor, former MD, SBI and former Chairman, PFRDA, are members of the committee.

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