RBI grants ‘in principle’ nod to Centrum Financial for setting up SFB
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The Reserve Bank of India (RBI) on Friday said it has decided to grant “in-principle” approval to Centrum Financial Services Ltd to set up a small finance bank (SFB). This will come as a huge relief for scam-hit Punjab and Maharashtra Co-operative Bank’s depositors as Centrum is set to take over their Bank.
“This “in-principle” approval has been accorded in specific pursuance to the Centrum Financial Services Limited’s offer dated February 1, 2021 in response to the Expression of Interest notification dated November 3, 2020 published by the Punjab & Maharashtra Co-operative Bank Ltd., Mumbai,” RBI said in a statement.
The “in-principle” approval is under the general “Guidelines for ‘on tap’ Licensing of Small Finance Banks in the Private Sector” dated December 5, 2019.
Many PMC Bank depositors are struggling to make ends meet amid the pandemic as the RBI put the Bank under Directions in September 2019, capping deposit withdrawal at ₹1 lakh per depositors for the entire duration of the Directions.
With Centrum Financial Services set to become an SFB, the directions on PMC Bank may be lifted.
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