The man behind AU Small Finance Bank's entry into the big league: Sanjay Agarwal
At the heart of AU's extraordinary journey is Agarwal, whose story exemplifies India's enterprise ethos. In 1996, at just 26, the newly qualified Gold-medallist Chartered Accountant from Jaipur, a first-generation entrepreneur and cricket enthusiast, declined a conventional corporate career to start his own finance company with a singular belief that 'India's underserved and unbanked deserved dignified financial services'. Starting with no institutional capital and no inherited influence, Agarwal established a lending company focused on offering vehicle finance to small entrepreneurs across Rajasthan's heartland, the bank said.
When he turned 25, Sanjay made the bold decision to return to Jaipur and lay the foundation for AU Financiers (India) Ltd, a small finance company aimed at providing loans for small vehicles. Sanjay, according to bank insiders, worked to gain the trust of local businessmen and investors, leveraging strategic partnerships and a keen focus on customer service to carve out a niche for AU Financiers in Rajasthan's financial landscape.
AU's name originated from the Latin word 'aurum', which means gold. The real turning point in the business came in 2015 when the Reserve Bank of India (RBI) introduced the Small Finance Bank (SFB) category to promote financial inclusion. AU Financiers, with its two-decade track record of making loans and collecting on them, was seen as well-positioned to take advantage of this opportunity. In 2017, AU Financiers transformed into AU Small Finance Bank, marking a significant milestone in Sanjay's entrepreneurial journey.
Today, it's one of India's more valuable banks, with a market capitalisation of over Rs 55,000 crore, higher than many established public and private banks. 'We have made history by receiving in-principle approval from the Reserve Bank of India to transition into a universal bank. This milestone is a reaffirmation of our purpose, perseverance, and passion. AU is not just a bank – AU is a mission. At AU, we have lived this mission every day. Our journey has always gone beyond banking – it's about building a more inclusive, empowered, and enterprising India,' Agarwal said in a conference on Friday, a day after getting the licence from the RBI.
'This in-principle approval acknowledges not just our ability to grow, but to grow responsibly. It is a testament to AU's strength in reaching widely, integrity in serving wisely, and resilience to shine across economic cycles,' he said in Mumbai.
The Agarwal family holds 21.4 per cent stake in the bank with Sanjay himself holding 15.73 per cent stake worth Rs 8,700 crore (nearly $1 billion). 'When I founded AU Financiers 29 years ago, I seized an incredible opportunity to decode India's remote and often unbanked areas, providing much-needed credit to these regions. A significant transformation occurred in 2017 when AU Financiers evolved into AU Small Finance Bank,' Agarwal wrote in his LinkedIn post. 'This evolution strengthened our reach and capability, enabling us to ignite belief and unlock the potential of everyone connected with us, thereby making a profound impact on a vast number of people,' he wrote in the post.
At the time of commencing operations, AU SFB was the only asset financing non-bank financier to receive the coveted license from the RBI out of a pool of 72 applicants. Within the very first year of starting its banking operations, AU became a scheduled commercial bank. The same year, the bank came out with its IPO, which went on to become one of the major public listings of 2017 as the lender raised nearly Rs 2,000 crore.
Since then, AU SFB has emerged as India's largest small finance bank, with a network of over 2,505 banking touchpoints across 21 states and 4 Union Territories, serving more than 1.16 crore customers with a workforce of around 53,000. As of June 2025, the bank has shareholders' funds of Rs 17,800 crore, deposits of Rs 1.28 lakh crore, a loan portfolio of Rs 1.18 lakh crore, with the balance sheet size at Rs 1.61 lakh crore.
'Coming from a humble background in Jaipur, if someone had told me that we would build the largest small finance bank in India, I would have found it hard to believe. Yet here we are—because I dared to dream and followed my passion. The results speak for themselves,' Agarwal said in his LinkedIn post.
He is now gearing up to be in the big league, with his bank getting the coveted universal banking licence.
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