The Reserve Bank today said it is in consultation with the government to finalise the draft guidelines for giving new banking licences.

“… the draft guidelines on the entry of new banks are being finalised in consultation with the Government of India,” RBI said, unveiling its annual monetary policy.

In the Budget 2011-12, Finance Minister Pranab Mukherjee had said the RBI plans to issue guidelines for the grant of new banking licences before the close of 2010-11. However, that deadline was missed.

Last month, the Finance Ministry said it is holding consultations with the RBI and will approve the draft guidelines for granting new banking licences within 15 to 20 days. However, the guidelines have not been issued yet.

Uncertainty continues over licences to new pvt banks

The Reserve Bank today said the uncertainty over issuing guidelines for new bank licences is likely to continue for some more time as it is in consultation with the government over the draft norms.

“There is some uncertainty about the time-frame for issuing new bank guidelines. We are discussing (the issue) with the Government,” RBI Governor D Subbarao told reporters here today.

“We must see where we agree and if there is any difference of opinion, we must resolve that so the legislation for amendment to the Banking Regulation Act, which is a pre-condition for the new bank licence framework (is passed),” he said.

The RBI was hoping that the legislation would go through in the Budget session but it got curtailed. There is some uncertainty about the timeframe as some loose ends are still to be tied-up, he said.

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June 2021