Full formBanking & Finance
SFBstands forSmall Finance Bank
Full Form of SFB
What is SFB?
Small Finance Banks, commonly abbreviated as SFBs, are a specialised category of banks introduced by the Reserve Bank of India in November 2014 to promote financial inclusion across the country. These banks are primarily designed to provide basic banking and financial services to underserved sections of society, including small farmers, micro-industries, unorganised sector workers, and rural households who have traditionally lacked access to mainstream banking channels. SFBs are mandated to maintain at least 75 percent of their lending portfolio in the priority sector, with a minimum of 50 percent of loans being up to Rs 25 lakh in size. They are required to hold a minimum capital of Rs 200 crore and operate strictly under the licensing framework of the RBI. Prominent examples of SFBs operating in India include AU Small Finance Bank, Equitas SFB, Ujjivan SFB, Jana Small Finance Bank, and Bandhan Bank. These institutions play a vital role in deepening banking penetration in semi-urban and rural India, complementing the efforts of commercial banks and regional rural banks. They are also permitted to offer digital banking services and issue debit cards to customers. This topic is frequently asked in competitive banking examinations such as IBPS PO, RBI Grade B, and SSC.
SFB का फुल फॉर्म
लघु वित्त बैंक
Example
After the RBI granted the in-principle approval, Equitas successfully transitioned into a Small Finance Bank, expanding its branch network across Tamil Nadu and other southern states.
SFB — frequently asked questions
What is the full form of SFB?
SFB stands for Small Finance Bank, a category of banks introduced by the RBI to promote financial inclusion in India.
Which authority issues licences to Small Finance Banks in India?
The Reserve Bank of India (RBI) is the authority that issues licences and regulates the functioning of Small Finance Banks across the country.
What percentage of loans must SFBs give to the priority sector?
Small Finance Banks are required to lend at least 75 percent of their total credit to the priority sector, with 50 percent of loans capped at Rs 25 lakh.