Niche players: Foreign banks fill a service gap

Although foreign players are relatively new to rural banking, they have an edge on their domestic counterparts: They are happy, indeed obliged, to go small.

"Local banks would not deal with the type of loan application [we do]," said Elton W.K. Lee, executive vice president and head of rural banking for HSBC.

Foreign banks are not permitted to set up rural outlets as branches under their locally incorporated banking entity. Each rural bank must be set up as a separat...

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