Indian private sector lender RBL Bank has picked up a 9.99% stake in Utkarsh Micro Finance (UMFL) to reach out to the unbanked and underbanked consumer segments.

Also, the bank signed a MoU to extend its product portfolio to customers of the microfinance firm.

Commenting on the partnership, RBL Bank MD and CEO Vishwavir Ahuja said: “It will help us extend our distribution footprint and strengthen our financial inclusion initiatives across the rural hinterland. We will strive to explore joint business opportunities that are beneficial to Utkarsh, RBL Bank and to our customers.”

UMFL, which secured in-principle nod from RBI to launch a small finance bank, has received all regulatory approvals for the deal with RBL.

Utkarsh Micro Finance MD and CEO Govind Singh said: “The long-term partnership with RBL Bank will help us augment our bouquet of products and services, including ancillary services. We hope to greatly benefit from RBL Bank’s domain knowledge of the banking and financial sector.”

The stake purchase in a microfinance firm by RBL is the latest in a series of similar moves made by other private sector banks in the country. In July 2016, IDFC Bank acquired 100% stake in Tiruchi-based Grama Vidiyal Micro Finance, while last month Kotak Mahindra Bank acquired BSS Microfinance.