RBI Grants In-Principle Nod to AU SFB to Transition into Universal Bank

The Reserve Bank of India on Thursday gave in-principle approval to AU Small Finance Bank Ltd. to convert into a universal bank. The lender had applied for the licence in September 2023.

In April, the central bank issued guidelines allowing small finance banks to voluntarily transition into universal banks. AU Small Finance Bank is currently the largest small finance bank in India by assets and market capitalisation.

As of June 30, the bank operated more than 2,505 banking touchpoints across 21 states and four Union territories, serving over 11.5 million customers. Its workforce exceeded 53,000 employees.

The lender’s net profit rose 15.6% on year and 15.3% on quarter to ₹5.81 billion in April–June , driven by a near 60% jump in other income, largely from treasury operations.

Following its earnings, the bank said it plans to expand its presence in key metro cities by adding 70–80 new deposit branches this year. “Our well-structured distribution channels are scaling efficiently, enabling us to deepen customer relationships and expand our deposit base sustainably,” the bank said.