Shivalik Mercantile Cooperative Bank, which received the license from the Reserve Bank of India to operate as a small finance bank, has commenced operations on 26 April. The Reserve Bank has issued a licence to the bank under Section 22 (1) of the Banking Regulation Act, 1949 to carry on the business of small finance bank in India. The urban cooperative bank was granted in-principle approval for transition into a small finance bank on 6 January 2020, under the ‘Scheme on voluntary transition of Urban Cooperative Bank into a Small Finance Bank’. It is the first urban cooperative bank in the country to transition itself into a small finance bank. The RBI stipulates that for the purpose of converting into a small finance bank, an entity should have a minimum net worth Rs 1 billion and the minimum capital adequacy ratio of 15% from the date of commencement of business. Shivalik Mercantile Cooperative Bank is a multi-state cooperative bank and operates through 31 branches across Uttar Pradesh, Madhya Pradesh and Uttarakhand. It acquired 2 Madhya Pradesh-based cooperative banks in 2010 and 2012. It serves some 400,000 customers.