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Small Finance Banks & Payment Banks article on official website

Small Finance Banks & Payment Banks – General Knowledge

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We post articles and blogs on important topics, news, and information related to banking exams. In this article, the following topic ’Small Finance Banks’ from banking section is explained.

Small Finance Banks

Small finance bank are niche banks in India.Small finance banks have been empowered to accept the deposits from its customers. Unlike Payments Banks, small finance banks can also lend money to the people.The objective behind small finance banks is to achieve financial inclusion to the sections of the economy not being covered by the other banks, such as small business units, micro and small industries,small and marginal farmers, and people working in an unorganized sector.
Most of the firms that have received the ‘in-principle’ approval include micro-financialinstitutions which mean, most of the customers of small finance banks will comprise of small and medium scale enterprises and small businesses. These banks will also be able to provide secure and legal loans to MSMEs and SMEs, bringing them under the roof of the financial system.


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