Mumbai, Sept 18 (KNN) Share of SKS Microfinance Ltd fell by as much as 20 per cent on Friday as the company didn’t qualify for the small finance bank licence from the Reserve Bank of India.

The central bank on Wednesday granted in-principle licence for small finance banks to 10 entities, out of which eight are microfinance institutions.

The 10 entities are Ujjivan Financial Services, Janalakshmi Financial Services, Equitas Holdings, Au Financiers (India), Capital Local Area Bank, Disha Microfin, ESAF Microfinance and Investments, RGVN (North East) Microfinance, Suryoday Micro Finance and Utkarsh Micro Finance.

According to RBI, a small finance bank should have 75 percent of its adjusted net bank credit to be extended to priority sector and it should have at least 25 branches in unbanked rural areas.

RBI in a statement said the ‘in-principle’ approval granted will be valid for 18 months to enable the applicants to comply with the requirements under the Guidelines and fulfil other conditions as may be stipulated by the RBI.

On being satisfied that the applicants have complied with the requisite conditions laid down by it as part of ‘in-principle’ approval, the RBI would consider granting them a licence for commencement of banking business under Section 22(1) of the Banking Regulation Act, 1949, it added.

SKS Microfinance had also failed to get a payments bank license, which RBI granted in August.

A total of 72 players had applied for the small finance bank licence and three different committees contributed to the final decision. (KNN Bureau)