Capital Small Finance Bank became the first small finance bank to start operations. The erstwhile Capital Local Area Bank, which won an in-principle approval from the RBI to convert itself into a small finance bank, began operations on 24 April with 10 new branches in addition to the 47 branches it already had in its previous avatar. The Jalandhar-based bank has been in existence since 2000. Inaugurating the bank, Nirmal Chand, regional director of RBI, Chandigarh, said it was a historic day for the banking sector in India as it would be reckoned as a day when small finance banks were introduced into the banking system. Sarvjit Singh Samra, MD of the bank, said the bank’s transition from a local area bank into a small finance bank has removed the geographical barrier on expansion. Earlier its operations were restricted to five districts in Punjab. Now it can expand to any part of the country. Samra said he plans to expand the bank’s operations in a phased manner. In the current financial year, it would add29 branches in Punjab.
