Now Reading: Equitas SFB may apply for universal banking licence in a year
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Equitas SFB may apply for universal banking licence in a year
Equitas Small Finance Bank plans to nearly treble its advances to Rs 1.2 lakh crore over five years, targeting 20 per cent annual growth, managing director and CEO P N Vasudevan told…
The Story in Brief
Equitas Small Finance Bank plans to nearly treble its advances to Rs 1.2 lakh crore over five years, targeting 20 per cent annual growth, managing director and CEO P N Vasudevan told rediff.com. The bank expects its landed cost of money to fall from 8.2 per cent in March 2026 to below 7.5 per cent in five years, boosting its competitive edge.
Equitas may apply for a universal banking licence within a year, Vasudevan said, adding that it is in touch with the RBI and will not rush. The bank has reduced microfinance's share to 10 per cent of its loan book and aims to cut informal and semi-formal borrowers' share from 90 per cent to 70-75 per cent over five years to lower risk.
The Indian Opinion
The usual narrative pits small finance banks as restless for universal licences, but Equitas' caution is refreshing. It learned from Ujjivan and Jana SFB's rejected applications not to chase the RBI's nod at the cost of portfolio quality. Vasudevan's five-year target for lower funding costs and a diversified book suggests the real test is not the licence but whether Equitas can sustain 20 per cent growth without piling up bad loans. Will the landed cost actually dip below 7.5 per cent by 2031? That number will settle the debate.
Source: rediff.com
This story was synthesised by AI from the source linked above.
