India Post along with Tata,
Ambani, Birla in race for new bank licence
The Reserve Bank of India, on 01 July 2013,
said it had received 26 applications for new bank licences, with Department of
Posts, Tata Sons, LIC Housing Finance, Aditya Birla Nuvo, Reliance Capital,
L&T Finance and Bajaj Finserv among those seeking the right to set up their
banks.
With
a total of 26 public and private sector companies applying for bank licences,
Finance Minister P Chidambaram on last day said that there was no ceiling on
the number of entities which can be permitted to operate a bank.
“I don’t think there is a ceiling. I don’t
think there is a number in mind. It all depends upon how many applicants are eligible
applicants. The fact that somebody applies doesn’t mean he is an eligible
applicant,” he said in an interview.
On whether India needs large banks or large
number of banks, the Finance Minister said there is a case for both. “A large
number of banks will mean more competition, a quicker reaching into the country
and faster financial inclusion. Large banks will mean that we are able to
finance large projects using our own bank resources rather than depending upon
foreign bank resources. So, both are required in this country,” he said.
RBI Governor D Subbarao had earlier said
that “our effort will be to make that judgement as transparent as objective as
contestable as possible...I want to say that not everybody who is fit and
proper will be given a (bank) licence because we expect the number of eligible
applicants will be much larger than what is meaningful number of licences we
can give”.
In its clarification, the RBI had said the
entities getting licences to open new banks will be given 18 months to open
branches, and promoters would have to transfer their holdings to the
non-operative financial holding company (NOFHC) in a stipulated period.
The Reserve Bank is expected to grant new
licences by March next year.
Presently, India has 26 public sector
banks, 22 private sector banks and 56 regional rural banks.
The below is the list of 26
companies that had applied for a licence:
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