SUMMaRY :- RBI has decided to give out bank licences only to IDFC Ltd and Bandhan Financial Services.
Industrial groups put up a brave face after the Reserve Bank of India decided to give out only two bank licences on Wednesday. The licences to IDFC Ltd and Bandhan Financial Services will raise the number of banks in India to 90.
The RBI, however, held out a promise that entities, which did not qualify in the current round, will be able to apply afresh. "RBI believes that some of those entities, which did not qualify in this round for a full-fledged banking licence, could well apply in future rounds or could apply for differentiated licences under the proposed framework", a release issued by the central bank noted.
Nirmal Jain, chairman of India Infoline, one of the permit aspirants said, "We are not disappointed as this is only the first set of licences and RBI has promised that going forward it will be on-tap." The big industry names which had applied included Reliance Capital of the Anil Ambani group, the Aditya Birla Group, Bajaj Capital and Larsen & Toubro.
The two will have an 18-month window to fulfill the guidelines stipulated by the RBI to offer banking services. "Until a regular licence is issued, the applicants would be barred from doing banking business," the RBI noted.
The HLAC had also recommended that in the case of Department of Posts, which has applied for licence, it would be desirable for the RBI to consider the application separately in consultation with the government. "The RBI has accepted the recommendation of the HLAC," it said.
TANAY TAPAS
PGDM 1st
Industrial groups put up a brave face after the Reserve Bank of India decided to give out only two bank licences on Wednesday. The licences to IDFC Ltd and Bandhan Financial Services will raise the number of banks in India to 90.
The RBI, however, held out a promise that entities, which did not qualify in the current round, will be able to apply afresh. "RBI believes that some of those entities, which did not qualify in this round for a full-fledged banking licence, could well apply in future rounds or could apply for differentiated licences under the proposed framework", a release issued by the central bank noted.
Nirmal Jain, chairman of India Infoline, one of the permit aspirants said, "We are not disappointed as this is only the first set of licences and RBI has promised that going forward it will be on-tap." The big industry names which had applied included Reliance Capital of the Anil Ambani group, the Aditya Birla Group, Bajaj Capital and Larsen & Toubro.
The two will have an 18-month window to fulfill the guidelines stipulated by the RBI to offer banking services. "Until a regular licence is issued, the applicants would be barred from doing banking business," the RBI noted.
The HLAC had also recommended that in the case of Department of Posts, which has applied for licence, it would be desirable for the RBI to consider the application separately in consultation with the government. "The RBI has accepted the recommendation of the HLAC," it said.
TANAY TAPAS
PGDM 1st
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