The Reserve Bank of India (RBI) has on Friday decided to grant “in-principle” approval to Centrum Financial Services Limited to set up a small finance bank under general “Guidelines for ‘on tap’ Licensing of Small Finance Banks in the Private Sector”.
The Reserve Bank of India approval came after Centrum Financial Services, along with Bharat Pe, submitted an expression of interest to take over PMC Bank. PMC Bank was put under several restrictions in September 2019. Curbs included restrictions on withdrawals of cash and investigation into accounting lapses.
The RBI would consider granting a licence for commencement of banking business under Section 22(1) of the Banking Regulation Act, 1949, on being satisfied that the applicant has complied with the requisite conditions laid down by RBI as part of “in-principle” approval.
This “in-principle” approval has been accorded in specific pursuance to the Centrum Financial Services Limited’s offer dated 1 February 2021 in response to the Expression of Interest (EOI) notification dated 3 November 2020 published by the Punjab & Maharashtra Co-operative Bank Ltd. (PMC Bank), Mumbai.
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