The current crisis around BharatPe’s MD and co-founder Ashneer Grover is unlikely to impact Unity Small Finance Bank.
Sources point out that Grover has no role to play at the bank and it is unlikely that there is anything for the RBI to look into amidst the current problems at the fintech
“The Reserve Bank of India had granted the license for the bank to Centrum Financial Services,” said sources familiar with the development.
Unity SFB, which took over Punjab and Maharashtra Co-operative Bank, commenced operations on November 1, 2021.
“With respect to the working and corporate governance, Grover has no role or relationship with Unity SFB and it is unlikely that RBI will look into the issue,” the sources said.
Unity SFB is a joint venture between Centrum Financial Services and Resilient Innovations Private Limited (BharatPe). Centrum holds 51 per cent stake and BharatPe has 49 per cent stake.
“Even in BharatPe, Grover holds a small stake of less than 10 per cent and the majority is owned by foreign investors,” pointed out another source, pointing out that Grover does not even hold a Board position at the bank.
“Unity SFB is a professionally run bank. Grover is just a shareholder. There is no relationship between the bank and events surrounding Grover and BharatPe,” the second source said, adding that it is business as usual at the bank.
On January 20 this year, the RBI approved the appointment of Vinod Rai, former Comptroller and Auditor General (CAG) of India as Part Time Chairman of the bank. Several banking industry stalwarts, including RBI veteran Sandip Ghose, Basant Seth former CMD Syndicate Bank and Subhash Kutte former Chairman, RBL Bank have recently joined the Board.
For BharatPe, the bank has been a feather in its cap and Grover, who is on leave from the fintech, has in recent media interviews spoken about the bank license.
Rajnish Kumar to mediate
Meanwhile, it is expected that former State Bank of India Chairman Rajnish Kumar, who joined as Chairman of the board of BharatPe, will try and bring affairs to order at the fintech.
Kumar joined as Chairman of the BharatPe board on October 12 last year.
“As the Chairman, he is working to address all issues at the company, including those of corporate governance,” said a source, adding that till now the business has not been impacted.
“The priority is to put all these problems to rest and ensure that business operations are not impacted,” the person said.