Sachin Bansal has stepped down as an independent director of Ujjivan Small Finance Bank effective January 27, after serving close to eight months in the position.
The co-founder of Flipkart has resigned in the interest of propriety and corporate governance as Navi Technologies, owned and controlled by him, has applied to the Reserve Bank of India for a universal banking license.
In his resignation letter, Bansal clarified that he shall also cease to be a member of various board committees of the bank and there are no other material reasons for his resignation.
Founded by Samit Ghosh, Bengaluru-based Ujjivan had received its Scheduled Bank status from the Reserve Bank of India in August 2017. Three months ago, it also received approval from the Securities and Exchange Board of India to raise Rs 1,200 crore in an initial public offering.
Bansal’s investment entity Navi, through its microfinance arm Chaitanya, has applied for a universal banking licence to provide mass-market banking solutions for individuals, MSMEs and select corporates.
Chaitanya, which essentially provides loans to low-income customers in rural areas on the joint-liability-group lending model, has made an application under the central bank’s On-Tap Banking License Guidelines. It operates via 40 branches in Karnataka, Bihar, Maharashtra, Rajasthan and Jharkhand.
In September, last year, Bansal had infused Rs 740 crore in Chaitanya and became the chief executive of the firm.
Media reports also suggested that Chaitanya will be the second microlender after Bandhan Bank to be granted a universal banking licence.
Earlier this month, World Bank’s investment arm IFC had made a disclosure report of its plans to invest around $30 million in Navi to support the transformation of Chaitanya into a technology-led universal bank or NAVI Bank.
At present, Navi is reportedly valued at about $670 million.