RBI submits draft on new banking licences

RBI submits draft on new banking licences

The Finance Ministry has got draft guidelines on new banking license, official sources said. The guidelines are at a draft stage and no firm view on the paid-up capital and other issues has been taken, sources said.

The Reserve Bank of India (RBI) is likely to issue guidelines for new banking licences by the end of the current fiscal. “RBI is planning to issue the guidelines for banking licences before the close of this financial year,” Finance Minister Pranab Mukherjee had said in the Budget speech last month.

After the Finance Minister’s announcement in 2010-11 Budget, the Reserve Bank had brought out a discussion paper in August 2010 on dispensing banking licences to business houses and non-banking finance companies, besides regulations for the same to foster greater competition.

The RBI also sought to know “whether industrial and business houses could be allowed to promote banks.” Further, it sought stakeholders’ views on whether NBFCs should be allowed to convert into or promote banks.

The apex bank has received comments on its discussion paper from all the stakeholders.