A primer on classification of banks in India

Click on graphic

The Reserve Bank of India (RBI) not only granted two in-principle banking licences out of a list of 25 applicants in April, a process undertaken after more than a decade, but also opened a window of opportunity for banking aspirants. Apart from offering licences on tap, the regulator will also offer differentiated licence for niche activities. As a result, payment banks, local area banks in the country will come into existence with universal banks that are present now.