New Delhi: The Reserve Bank of India (RBI) has decided to not give any new banking licence to players for 2-3 years, sources told Zee Media.
The Board of Financial Supervision of the RBI has taken in-principle decision to not proceed further on new banking licence, sources further said.
Decision on new licence will be taken after taking into consideration the situation of existing new banks, sources added.
The RBI gave in-principle approval to 10 payments banks and 11 small finance banks in the year 2015.
IDFC and Bandhan Financial Services emerged successful contenders for universal bank licences issued by the RBI and have been doing well. However, other banks have not been able to set any remarkable mark in the sector.
Paving the way for entry of new players in banking sector, the RBI under governor Raghuram Rajan had started ‘on tap’ universal banking licence regime in 2016. Although the central bank excluded large industrial houses from the purview though they could invest up to 10 percent in new banks.
This allowed Individuals or professionals who are ‘residents’ and have 10 years of experience in banking and finance at a senior level and existing non-banking financial companies (NBFCs) that are ‘controlled by residents’ and have a successful track record for at least 10 years could apply for the licence.
RBI is also gauging the condition of payment banks that still have not been able to make any mark in the sector. Payments banks can accept deposits up to Rs 1 lakh per account from individuals and small businesses.
