VFS Capital Withdraws Small Finance Bank License Application

VFS Capital Ltd, a Kolkata-based microfinance institution, has withdrawn its application for a small finance bank license. The Reserve Bank of India announced the withdrawal, which comes after VFS Capital applied under the 'on tap' licensing guidelines. The microfinance institution, established in 1996-97, was an early NBFC licensee.

In a recent announcement, the Reserve Bank of India disclosed that VFS Capital Ltd has retracted its application for a small finance bank license. The decision follows an earlier application under the RBI's 'on tap' licensing guidelines.

This move marks the latest development in the microfinance landscape, as VFS Capital, based in Kolkata, initially applied among 72 contenders a decade ago. At that time, the Reserve Bank was expanding the concept of differentiated banks.

Founded in the mid-1990s, VFS Capital has been a pioneer within the microfinance sector, registering as an NBFC-MFI with the RBI in 2013. The 'on-tap' application system for small finance banks has been in place since 2019, providing a streamlined process for institutions aiming to expand their banking operations.

(With inputs from agencies.)