What is the purpose of setting up of Small Finance Banks (SFBs) in India?
1. To supply credit to small business units
2. To supply credit to small and marginal farmers
3. To encourage young entrepreneurs to set up business particularly in rural areas.
Select the correct answer using the code given below:
Answer:
(a)
Core Books/NCERT
Local focus and ability to serve smaller customers will be a key criterion in licensing such banks. The bank shall primarily undertake basic banking activities of accepting deposits and lending to small farmers, small businesses, micro and small industries, and unorganized sector entities. The area of operations would normally be restricted to few districts (near-by) of a state. Of the loans issued by Small Banks, 75% should be to the so-called priority sector which includes agriculture and small businesses. www.civilsdaily.com/small-finance-banks-background/