Insurance firms, banks rush to invest in small finance banks

At Ujjivan, insurance companies hold 9.75% stake as on September 30, 201

Small finance banks (SFBs) seem to have become the favourite of the season. In a majority of the proposed SFBs, insurance firms have picked up stakes. Banks and mutual funds, too, have been investing in SFBs. 

One of the reasons that financial institutions are betting on is the potential synergy in distributing financial products in the rural and semi-urban markets, say experts. 

At Ujjivan, which got listed on stock exchanges a few months ago, insurance companies hold 9.75% stake as on September 30, 2016. Insurance companies which picked up stake include HDFC Standard Life Insurance, Bajaj Allianz Life Insurance, Birla