The Reserve Bank of India (RBI) has rejected three applications, including that of West End Housing Finance, for setting up small finance banks. These applications were found not suitable for granting of in-principle approval to set up small finance banks, the RBI said in a statement on Tuesday. 

RBI had received about a dozen applications to set up banks under the guidelines for on-tap licensing of universal banks and small finance banks.

In May last year, it had announced the decisions on six applications.

According to the RBI, the examination of three more applications for setting up a small finance banks have been completed as per the procedure laid down under extant guidelines. 

Based on the assessment of the applications, the applicants “not found suitable” for granting of in-principle approval to set up a small finance bank are Akhil Kumar Gupta, Cosmea Financial Holdings Pvt Ltd and West End Housing Finance Ltd, it said. 

The central bank also said that the remaining applications were under examination. 

The guidelines for on-tap licensing of universal banks and small finance banks in the private sector were issued on August 1, 2016, and December 5, 2019 respectively.