Officials hope tough regulations could eventually let NBFCs into banking

RBI accepted 21 of 33 recommendations of internal working group, the key being allowing promoters to hold 26% in the bank they floated. RBI did not mention corporate and NBFC issues in its guidelines

The Reserve Bank of India’s (RBI) decision to stay away from taking an immediate call on corporate entry into banking, and letting large non-bank financial companies (NBFC) convert into banks may have disappointed some, but was not entirely unexpected.  

Rather, some of the large NBFCs are hoping that the scale-based regulation on NBFCs, which brings large para-banking units at par with banks gradually, would be the first step towards letting them graduate into full-scale commercial banks.

In its ownership guidelines and corporate structure for private banks, released on Friday, the RBI kept silent on two critical recommendations of an internal