Ujjivan Small Finance Bank (USFB) is an Indian small finance bank headquartered in Bengaluru, Karnataka. It primarily serves customers in the unserved and underserved segments of the population, with a strong focus on financial inclusion through microfinance, retail banking, and small business lending. The bank is a wholly owned subsidiary's successor to Ujjivan Financial Services, which was its original microfinance promoter.
| Type | Small Finance Bank |
|---|---|
| Industry | Banking, Financial services |
| Headquarters | Bengaluru, Karnataka, India |
| Predecessor | Ujjivan Financial Services |
| Regulator | Reserve Bank of India |
| Listing | BSE, NSE |
| Country | India |
Background
The origins of Ujjivan Small Finance Bank lie in Ujjivan Financial Services, a microfinance institution founded in 2005 by Samit Ghosh in Bengaluru. The institution was set up with the objective of providing financial services to the economically active poor, particularly women, in urban and semi-urban India. Over the following decade, Ujjivan grew into one of the larger non-banking microfinance companies in the country, operating across multiple states.
In October 2015, the Reserve Bank of India (RBI) granted in-principle approval to ten entities, including Ujjivan Financial Services, to set up small finance banks under a new licensing framework intended to deepen financial inclusion. Ujjivan Small Finance Bank received its final banking licence and commenced operations on 1 February 2017, with the parent company transferring its microfinance business to the new banking subsidiary.
Operations
USFB offers a range of products including savings accounts, current accounts, fixed and recurring deposits, group loans for women based on the joint liability model, individual loans, micro and small enterprise loans, affordable housing loans, vehicle loans, and personal loans. The bank also distributes third-party insurance products and provides digital banking channels such as mobile banking, internet banking, and ATMs.
Its branch network spans urban, semi-urban and rural locations across multiple Indian states, with a significant presence in southern, eastern, and northern India. A large share of the bank's borrower base is women availing microfinance loans.
Listing and corporate structure
Ujjivan Financial Services, the holding company, was listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange of India (NSE) following its initial public offering in 2016. Ujjivan Small Finance Bank itself launched an initial public offering in December 2019 to comply with SFB licensing conditions requiring listing within three years of commencing operations, and its shares were subsequently listed on the BSE and NSE.
In later years, the bank and its holding company initiated a reverse merger process under which Ujjivan Financial Services was to be merged into Ujjivan Small Finance Bank, simplifying the corporate structure.
Significance
USFB is one of the small finance banks created under the RBI's 2014 guidelines, a category designed to expand banking access to small business units, marginal farmers, micro and small industries, and other unorganised sector entities. The bank's transition from a microfinance institution to a scheduled commercial bank illustrates the policy goal of converting strong microfinance franchises into regulated deposit-taking entities, broadening the formal financial system.
Related topics
- Small Finance Bank
- Reserve Bank of India
- Microfinance in India
- Financial inclusion in India
- Banking in India
- Ujjivan Financial Services
References
- Reserve Bank of India, guidelines and licensing notifications on Small Finance Banks.
- Ujjivan Small Finance Bank corporate disclosures and annual reports.
- Wikidata entry: Q42529272.