North East Small Finance Bank to launch on FIS Profile core banking system
North East Small Finance Bank (NESFB), the first bank of its kind in the northeast of India, is gearing up for launch in early June.
The bank received the necessary regulatory approvals and a banking licence from the Reserve Bank of India (RBI) in April this year.
NESFB is set to launch with 164 branches across eight Indian states in the northeast of the country plus West Bengal. It plans to onboard 500,000 clients by the end of the year.
It will offer current, deposit and savings accounts, and micro-lending.
The bank is backed by non-profit development organisation Rashtriya Gramin Vikas Nidhi (RGVN) and Small Industries Development Bank of India (SIDBI).
For its technology, NESFB will be using an outsourced banking and payments platform provided by FIS. The solution is based on the Profile core banking system.
FIS’s hosted platform already has a number of takers in India. Shivalik Mercantile Co-operative Bank was the first customer – it signed in 2013. It was followed by Bharatiya Mahila Bank (BMB), India’s first public sector bank catering exclusively for women; Bandhan Financial Services, India’s largest microfinance institution; and ESAF Small Finance Bank.
Small finance banks (SFBs)
Small finance banks (SFBs) are new niche players in India – aimed to facilitate financial inclusion. They provide basic banking services to the sectors often overlooked by mainstream banks, such as micro and small businesses, small farmers etc.
There are currently less than ten SFBs in India. These include Capital Small Finance Bank, Suryoday Small Finance Bank, Equitas Small Finance Bank, Utkarsh Small Finance Bank, Ujjivan Small Finance Bank, and the aforementioned ESAF Small Finance Bank – soon to be joined by NESFB.