Debasis Mohapatra
Bengaluru, 15 April 2026
Ujjivan Small Finance Bank’s share price closed 3.17% down at Rs 58.39 on Wednesday as the application of the bank to convert into universal bank got rejected by Reserve Bank of India.
In an exchange filing on Monday, RBI has returned its application for conversion into a universal bank, saying that the lender needs to further diversify its loan book beyond its current one. The RBI has advised the bank to consider reapplying after demonstrating a more diversified loan portfolio.
“The RBI, through its…letter, took note of the bank’s recent efforts towards diversification of its loan portfolio. However, it was of the view that there is scope for progress in this area. Therefore, RBI has returned the above-mentioned application and advised the Bank to consider applying again after demonstrating a diversified loan portfolio,” the bank said in the filing.
The bank had submitted its application to transition into a universal bank in February 2025. It was among three small finance banks — Ujjivan Small Finance Bank, AU Small Finance Bank, and Jana Small Finance Bank — that had applied to the Reserve Bank of India for such a conversion.
AU Small Finance Bank had received the RBI’s approval last year and is in the process of transitioning into a universal bank. Meanwhile, Jana Small Finance Bank’s application was also returned by the central bank.
