Correct Option (A)
Small Finance Banks (SFBs) were established in India with the primary objective of promoting financial inclusion. Their mandate includes providing credit facilities to underserved segments of the population, such as small business units and small and marginal farmers. Therefore, statements 1 and 2 accurately reflect the core purposes of SFBs.
Incorrect Options:
Statement 3 is incorrect. While SFBs may indirectly support entrepreneurship through credit provision to small businesses, their explicit primary objective is not to specifically encourage young entrepreneurs to establish businesses, particularly in rural areas. Their focus is broader, encompassing credit supply to various small economic entities and individuals to foster financial inclusion.