RBI last month gave in-principle approval to 11 entities to set up payments banks.
"There is another category of differentiated bank that is small finance bank which we expect to announce again in-principle approval in the next few days," Mundra said during a panel discussion at an event organised by The Economist.
RBI had received 72 applications for small finance bank licences.
The small finance banks can provide basic banking services like accepting deposits and lending to the unbanked sections such as small farmers, micro business enterprises, micro and small industries and unorganised sector entities.
Later interacting with reporters, Mundra said India is better prepared to deal with the impact of the likely rate hike by the US Federal Reserve.
"The relevant point to understand is how we are prepared for it. And in that context if we look today compared two years back, I think we are much better prepared for that," the Deputy Governor said, adding that current account deficit (CAD) is better, foreign exchange reserve comfortable and macro-economic environment stable.
"So, I don't think any regulatory response is immediately needed," he said, adding that RBI will not hesitate to take necessary steps.

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