RBI Waives NOFHC Requirement for AU Small Finance Bank's Universal Bank Transition

The Reserve Bank of India (RBI) has relaxed the requirement for AU Small Finance Bank to establish a non-operative financial holding company (NOFHC) as a precondition for its transition to a universal bank. The NOFHC structure will now be mandated only if the bank or its promoters plan to set up additional financial subsidiaries in the future. AU Small Finance Bank received in-principle approval in August 2025 and must apply for the final universal banking license within 18 months, subject to RBI's regulatory assessment.