A Critical Comment on New Bank Licenses

Abstract

RBI's moves are fraught with the risk of chocking the flow of funds to the desired sectors because banks in the private sector operate purely on commercial consideration and not for societal good. The Reserve Bank of India Act empowers the bank to issue new bank licences. The Reserve Bank of India (RBI) has been following the practice of considering applications from business entities and corporate houses for issuing new licences for commencing banking operations.