Kerala gets first private bank: ESAF Small Finance Bank

ESAF Small Finance Bank
ESAF Small Finance Bank, Kerala's first private sector bank since the country's independence, was launched by Chief Minister Pinarayi Vijayan at Thrissur.

Thrissur, March 17: ESAF Small Finance Bank, Kerala’s first private sector bank since the country’s independence, was launched by Chief Minister Pinarayi Vijayan at Thrissur.

ESAF Small Finance Bank, promoted by ESAF Microfinance and Investments (P) Ltd, will open with15 branches on an inaugural day and be planning to set up 85 branches in the first year itself.

As per Reserve Bank Of India guidelines, the bank is required to open 25 percent of its branches in unbanked rural areas besides in cities like Bengaluru, Kolkata, Mumbai, Delhi and Hyderabad in the first year.

ESAF Microfinance, the promoters of ESAF Small Finance Bank, is one of the 10 firms selected by the Reserve Bank Of India for setting up small finance bank, which was conceptualized by the country’s apex bank to further financial inclusion.

“ESAF Microfinance, which presently has a network of 285 branches in 93 districts spread over 11 states, will currently convert all its existing branches into customer service centers or ultra-small branches or satellite offices,” said K. Paul Thomas, Managing Director, and CEO, ESAF Small Finance Bank.

ESAF Microfinance, which owes its success to the doorstep delivery of services, will replicate the same model for the bank.

“We are planning to appoint 10,000 agents for providing the banking services at doorsteps. The agents will provide services such as account opening, banking transactions, and small value loans,” added Thomas.

With owned fund of over Rs. 300 crores, ESAF has recently raised another Rs. 330 crore through the issue of commercial papers. The new bank of Kerala is targeting a business of Rs. 20,000 crores by 2020.

R Prabha, former chairman, Kerala Grameen Bank, is the Chairman of ESAF Small Finance Bank.

The bank will launch a new social deposit scheme, ‘Hridaya Deposits,’ for High Net Worth Individual (HNI) and Non-resident Indian (NRI) customers.

“It will enable them to contribute to the overall development of the underdeveloped segments in the society,” Paul Thomas said.

The minimum deposit limit for the scheme is Rs. 15 lakh and there is no maximum limit. Depositors can inform the preferred target segment that belongs to the lower strata of the society.

As a value added service, customers will be provided facilities for making Skype calls to the kith and kin at free of cost at the bank branches.