The investment limit for obtaining a bank licence should be pegged at Rs 1,000 crore with the stipulation that promoter should bring in the amount within five years, said industry chamber Assocham.
The Reserve Bank of India (RBI), in its draft report, has stipulated an investment of Rs 500 crore for a bank licence.
On the matter of foreign shareholding in the bank, the chamber welcomed the cap of 49 per cent for the first five years. But, it said to help foreign shareholders to form their long-term investment decisions, there is a need for clarity on what would be the status of limit of FII holding after first five years.
It also said the mandatory requirement of new bank to get listed within two years of licensing is not pragmatic and feasible.
Further, it added there should be some method by which the banks are compensated suitably for the lower profitability from the branches in unbanked areas.
