RBI norms for new bank licences likely by Nov-end: FinMin

The Reserve Bank of India (RBI) is likely to come out with guidelines on allowing new private banks by November end, Financial Services Secretary DK Mittal said today.

"The RBI is actively working on the guidelines...And is likely to come out with the final licencing norms by November," he told reporters on the sidelines of the Economic Editors conference here.

The RBI had in August released the draft guidelines on allowing industrial houses to promote banks.

As per the draft norms, private sector entities or groups owned and controlled by Indian promoters, with diversified ownership, sound credentials and integrity, and having successful track record of at least 10 years, would be eligible to promote banks.

Earlier this week some Members of Parliament (MPs) had expressed reservations at a meeting of Standing Committee over the RBI's proposal to grant banking licences to industrial houses arguing that it would not promote financial inclusion.

The draft norms on bank licences have pegged the minimum required capital for promoting bank at Rs 500 crore and restrict foreign shareholding at 49% for the first five years.

On implementation of the Shyamala Gopinath committee report on small savings scheme, Economic Affairs Secretary R Gopalan said,"final decision will be taken shortly."

The Committee had suggested that the returns on small savings scheme be aligned the market rates and post office savings scheme interest rate be raised to 4%.

According to government estimates, small savings during the first quarter (April-June) of the current fiscal declined by Rs 26,542 crore. They had increased by Rs 13,250 crore in the same period last year.