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Equitas, Fino gear up for upgrade in banking profile

July 28, 2023

Equitas, Fino gear up for upgrade in banking profile
After a decade, new bank licences are in the offing; but no new names appear likely. Equitas Small Finance Bank and Fino Payments Bank, which have completed over five years in the respective domains, are looking to move up the value chain. The licensing guidelines for SFBs and payments banks permit conversion to the next category of banking after five years of operations.

Equitas is aspiring to be a universal bank, whereas Fino seeks small finance bank licence. As a universal bank, the priority sector requirements for Equitas will reduce from 75 per cent to 40 per cent, while the transition into an SFB will allow Fino to lend to its customers.
 
Although nothing has been formalised yet, highly placed sources say Equitas has started engaging with the banking regulator on these lines. “There have been a few rounds of discussions with senior executives of the Reserve Bank of India, and a few procedural aspects need to be addressed in order to make a formal application to the RBI,” said a person aware of the matter. “The bank has a diverse loan book compared to peers and has been recently authorised to deal in forex. The logical next step is becoming a universal bank.“
 
An email to Equitas SFB for clarity on the matter remained unanswered until the time of writing this. In an interview tobusinesline, dated January 17, PN Vasudevan, MD and CEO, Equitas SFB, indicated that the bank is keen to convert into a universal bank.
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