With respect to the new draft guidelines released by RBI for on tap licencing of small finance banks...........

Finance changing landscape in banking sector

With respect to the new draft guidelines released by RBI for on tap licencing of small finance banks in private sector, which of the following activities can be undertaken by small finance bank?

They can undertake basic banking activities of acceptance of deposits and lending.

It can also undertake other non-risk sharing simple financial services activities.

The small finance bank can also become a Category II Authorized Dealer in foreign exchange business.

Both A and C

?All of the above

Explanation:

• Small Finance Bank can undertake basic banking activities of acceptance of deposits and lending to unserved and underserved sections including small business units, small and marginal farmers, micro and small industries and unorganised sector entities.
• It can also undertake other non-risk sharing simple financial services activities, not requiring any commitment of own fund, such as distribution of mutual fund units, insurance products, pension products, etc. with the prior approval of the RBI and after complying with the requirements of the sectoral regulator for such products.
• The small finance bank can also become a Category II Authorized Dealer in foreign exchange business for its clients’ requirements.