Reserve Bank of India(RBI) did not accept the proposal to consider large corporates and industrial houses for a banking licence. However, it allowed promoters of banks to hold up to 26% in their banks, which is a positive for many lenders, including Kotak Mahindra Bank, Induslnd Bank, CSB bank.
The new protocols allow those who have already diluted stakes to hike their shareholders and the concept of shareholding. On Friday, Reserve Banking of India (RBI) said it had accepted 21 of the 33 recommendations made last year by an internal working group to review extant ownership and corporate structure for Indian private sector banks.
A critical proposal that was accepted was to increase the capital requirement for new applicants to Rs 1000 crores instead of Rs 500 crores.
In November 2020, the (IWGREOG) Internal Working Group to Review Extant Ownership Guidelines and Corporates Structure for Indian Private Sector Banks said that corporates might be allowed as promoters of banks only after necessary amendments to the Banking regulations Act 1949.
Under the Retail Scheme, many people can invest in central government securities such s treasury bills, state development loans, and sovereign gold bonds among or through a portal.
It will propel many Indians into the league of some or all of the countries that give such a facility. “Investors more or less are now able to easily open and maintain their government securities account online with the RBI, free of cost,” Prime Minister Narendra Modi said.
The analysts said, ” There were 14 per cent rise in oil prices to USD 83 per barrel and also 15 per cent increase in coal rate to USD 200 per tonne.”They added, ” This rise in the prices, especially oil increased concerns of higher inflation, and whether it may lead to the policy .”
They said that there were risks to rapid inflation and growth and won’t improve from the two-year compounded growth rate.
It also, in turn, lead to the equalization of the policy. At present, RBI has three separate ombudsmen- for the banks, NBFCs and digital payments. These are operated by 22 Reserve Bank of India ombudsman officers across the country.
They will also be integrated into one of the centralized schemes to make the grievance redress mechanism simpler and much more effective.
Customers will lodge complaints, submit documents, track status and give feedback through a single email address under the new scheme. There will also be a multilingual toll-free number that will provide all relevant information on grievance redress.
The complaints which are not covered under the ombudsman scheme will continue to be addressed by the Customer Education and Safeguarding cells located in the 30 regional offices of the Reserve Bank of India.
As for the Retail scheme, people can access the online portal to open securities for the accounts with the central bank, bid them in primary auctions, and buy and sell the papers. They can make the payment for transactions through internet banking and the UPI, using their savings bank accounts.
The investor support facility will be made available via telephone, emails and through the internet.
This would enable the RBI to have the power to do consolidated supervision of conglomerates. It was stated that the well-run NBFCs, including those owned by any corporate houses, should also be considered for bank allowed licences.
Industry insiders also speculate that the Bajaj Finserv, L&T Finance and the Piramal. The Piramal might be one of most of the corporate houses that is interested in getting bank licences.
While Bajaj is active in almost banking, Piramal has acquired the DHFL as part of its goal to get retail business and had bought a former banker with the head of its financial services. L&T Finance had also earlier declared its intent to pursue the bank licence.
The recommendation had also faced criticism from several quarters, and the RBI has been uncomfortable allowing business houses into banking. The regulator remained silent on this specific proposal but said that this was not accepted and will not be under examination.
