The Reserve Bank of India has granted in-principal approval to Centrum Financial Services Limited to set up a small finance bank, paving the way for takeover of Punjab & Maharashtra Co-operative Bank.  

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This “in-principle” approval has been accorded in specific pursuance to the Centrum Financial Services Limited’s offer dated February 1, 2021 in response to the Expression of Interest notification dated November 3, 2020 published by the Punjab & Maharashtra Co-operative Bank Ltd., Mumbai. 

The central bank granted approval on Friday, June 19. "The Reserve Bank of India (RBI) has today (read June 18) decided to grant “in-principle” approval to Centrum Financial Services Limited (the applicant) to set up a small finance bank under general “Guidelines for ‘on tap’ Licensing of Small Finance Banks in the Private Sector” dated December 5, 2019," said a statement from the Reserve Bank of India.  

The RBI said it will grant a licence for commencement of banking business only after being satisfied that Centrum Financial Services Limited has fulfilled all conditions. "The RBI would consider granting a licence for commencement of banking business under Section 22 (1) of the Banking Regulation Act, 1949, on being satisfied that the applicant has complied with the requisite conditions laid down by RBI as part of “in-principle” approval," reads RBI statemen.  

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