With the latest infusion of capital, the foreign shareholding in the company will fall below 49%. Companies with small bank licences are trying to lower foreign investor holding to meet Reserve Bank of India (RBI) guidelines; larger firms have opted for initial public offerings (IPOs) to meet the objective. RBI issued small bank licences to 10 entities in September 2015 with a time frame of 18 months to convert to banks. Small finance banks will offer basic banking services, accepting deposits and lending to unserved and underserved sections including small business units, small and marginal farmers, micro and small industries, and entities in the unorganized sector. Utkarsh plans to launch its small finance bank operations by January 2017, said Singh.

http://www.dealstreetasia.com/stories/utkarsh-micro-finance-raises-rs395-crore-from-domestic-investors-54459/