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Anand Sinha, deputy governor of the Reserve Bank of India (RBI), said all banking licence applicants will have to comply with the requisite norms.
In the recent past, some applicants had asked RBI for exemption from meeting certain criteria. According to Sinha, unless RBI scrutinises all applications, they cannot take a definite view on the dispensation. “But broadly, the guidelines are there and people will have to comply with that,” said Sinha.
In all, RBI has received 26 applications. “We have started the work. It is quite an extensive work because now we are looking at corporate groups. The work load is quite heavy on that sense. The process is on,” said Sinha.
In the recent past, some applicants had asked RBI for exemption from meeting certain criteria. According to Sinha, unless RBI scrutinises all applications, they cannot take a definite view on the dispensation. “But broadly, the guidelines are there and people will have to comply with that,” said Sinha.
In all, RBI has received 26 applications. “We have started the work. It is quite an extensive work because now we are looking at corporate groups. The work load is quite heavy on that sense. The process is on,” said Sinha.
There is also a committee on this, which is likely to be set up. “We are in the process, but the committee’s work will start after the internal scrutiny is over. We have some time,” said Sinha.
On the Know Your Customer (KYC) norms, he said there are still complaints that people find it difficult to open accounts. “What we gather is that RBI’s instructions are not really well percolated down into the branches and that is where banks have a responsibility to ensure that,” he said.
He suggested the identity requirements could be simplified for certain no-frills accounts. “Banks could also be encouraged to revise products suiting to these segments in terms of lower charges, lower or no minimum balance requirement etc.”
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From a policy perspective, foreign banks are into setting up wholly-owned subsidiaries. “When that happens as per the discussion paper that we have issued, foreign banks would be almost at par with the domestic banks in terms of almost everything including branch expansion,” said Sinha.
When the wholly-owned subsidiary scheme kicks off, the whole of India will be available to foreign banks at par with the domestic banks. “Those who want to really exploit, there will be huge opportunities. This is a scheme in the discussion paper and I hope when the final scheme comes, it will be more or less on the same lines,” said Sinha.
