Dewan Housing applies for small bank licence

In a notice to exchanges, Dewan Housing Finance Corporation (DHFL) has said it has filed an application for a small bank licence from the Reserve Bank of India. The management said conversion into a small bank would enable the entity to have a more robust and scalable business model, one that aligns well with its long-term growth and profitability aspirations, while continuing to focus on core capabilities towards financial inclusion. According to RBI guidelines, a small finance bank and non-banking financial company (NBFC) cannot co-exist. "On conversion into a small finance bank, the NBFC/MFI will cease to exist and all its business which a bank can undertake should fold into the bank and the activities a bank cannot statutorily undertake be divested/disposed of. The branches of the NBFC/MFI should either be converted into bank branches or be merged/ closed, according to the business plan," RBI had said. In another development, FINO PayTech has applied for a payment bank licence. Rishi Gupta, chief operating officer and executive director, said as a business correspondent, the company had been providing access to banking services in remote rural locations, transactions from urban to rural areas and "payment bank is a natural progression for us".