Let’s have banking licence on tap

............As a principle, the Indian banking regulator was not in favour of opening up the sector till February 2010, when former finance minister Pranab Mukherjee announced that a new set of private firms would be allowed to set up banks. RBI was, in fact, in favour of consolidation in the sector. After the budget announcement, the central bank got into action, but with reluctance. Which is why it took so long to prepare the draft licensing norms and, more than a year after the release of the draft norms, there is no sight of the final licensing norms. The reason behind this is well known. RBI wants the power to supersede the board of a rogue bank and this can be done by amending the Banking Regulation Act of 1949. Unless Parliament gives its nod to the amendment, RBI is unwilling to bet on a new set of banks run by industrial houses............

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