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RBI likely to list eligibles first,hand licence later

P Chidambaram is reported to have said seven licences will be handed out by RBI by January 2014

Written by ENS Economic Bureau | Published: October 6, 2013 1:23:05 am


New Delhi,OCTOBER 6

The Reserve Bank of India is likely to clear a list of eligible contenders for getting a bank license next year rather than hand out licences per se.

RBI deputy governor KC Chakrabarty said as much over the weekend. “Let me clarify,no new bank will come by January. A provisional list of applicants who are eligible to get a licence will be decided in January. New banks will take at least two years to come.”

Chakrabarty was responding to queries from reporters.

RBI Governor Raghuram Rajan has already said he wants to make bank licences available on tap instead of being a one-off affair. The deputy governor’s comments are in sync with that intention.

While agency reports claimed finance minister P Chidambaram is reported to have said seven licences will be handed out by RBI by January next year,finance ministry sources told The Indian Express it was too early to talk about numbers. “As of now,only the first round of examination of the applicants have been made,” a top level source said.  

Rajan has also said a decision on the licences will be taken before the end of the term of deputy governor Anand Sinha,who is in charge of banking department. Sinha will retire at the end of January.

After announcing a panel headed by former RBI Governor Bimal Jalan to look into the issue,Rajan on Friday followed up by announcing the remaining members of the committee. The panel includes former RBI deputy governor Usha Thorat,former Sebi chief CB Bhave and a former executive director at ICICI Bank Nachiket Mor.

Twenty-six entities,including the Tatas,Aditya Birla Group,Reliance Capital and Religare,apart from India Post have applied. The RBI had last issued licences in 2002,to Kotak Mahindra Bank and Yes Bank.

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