Fin inclusion plan to be a criteria for new bank licences: RBI

The Reserve Bank of India (RBI) Governor D Subbarao today said the central bank will look at business plan for financial inclusion, in addition to other things, before granting banking licence under the new policy.

"One of the criteria for evaluating application (for new bank licence) that we will get in due course of time, will indeed be their business plan for financial inclusion," Subbarao said at an IIF event here.

The RBI is scheduled to announce the guidelines for grant of new bank licences by month-end.

The central bank, in August 2010, brought out a discussion paper on giving out new 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". Furthermore, it sought stakeholders' views on whether NBFCs should be allowed to convert into or promote banks.

The RBI has received comments on its discussion paper from all stakeholders.

Various entities such as Reliance Capital, IndiaBulls, Religare, IL&FS, IDFC, IFCI and Aditya Birla Financial Services are reported to be mulling entering the banking space.

At present, India has 26 public sector banks, seven new private sector banks, 15 old private sector banks, 31 foreign banks, 86 regional rural banks, four local area banks, 1,721 urban cooperative banks, 31 state cooperative banks and 371 district central cooperative banks.