NBFCs feel they are a better option for getting a bank license
By Joseph Samson
Oct 8, 2010
Print    Email    RSS   

Non banking finance companies (NBFCs) feel that they are in a better position to receive banking licenses than corporate houses who are their major competitors in the race. They have also discussed this with Reserve Bank of India emphasizing their competency on the fact that they are used to do business and run under RBI guidelines and regulations.

Corporates give their stand saying that they have experience and strong presence in financial sector and thus they should be given bank license.

This issue was discussed in a meeting held on Thursday. Three RBI deputy governors - Usha Thorat, KC Chakrabarty and Subir Gokarn - were present in the meeting. Five prominent NBFCs - Mahindra & Mahindra Finance, Indiabulls Financial Services, Reliance Capital , Srei and Sriram Transport - attended the meeting which was led by FIDC.

"We have pointed out to RBI that NBFCs who are asset financing with good track record are better placed to run a bank than a corporate house. Secondly, NBFCs are competent because unlike corporates, they are familiar with RBI regulations," said Mahesh Thakkar, director general of Finance Industry Development Council.

"Policymakers should be clear on what their concerns are and address them accordingly, rather than take a carte blanche view. If the concern is that public deposits would be at risk, they should address that. If the fear is of group lending, there can be measures such as higher risk weightage to discourage such loans," said Ernst & Young national director Viren Mehta.


(Comments Posted : 0) Post Your Comments
Show All Comments
 Select a product:

 Select a product:

What if you default on your loan?
Home Loans come with Tax Rebates!
Home Equity Loan: A shoulder you can bank...
This is how a bank lends money
RBI reports 19.73% credit growth of banks...

PINJORE: CaℒL Giℛℒs In PiNjOrE 09915787550...
PINJORE: CaℒL Giℛℒ In PiNjOrE 09915787550...
how to gate my home loan certificate

Canara Bank earned a profit of 60%. Feb 6, 2015
New Branch of Laxmi Vilas bank at Vijayawada Jan 30, 2015
Home loan EMIs expected to drop down Jan 21, 2015
Corporation Bank received MSME banking excellence award 2014 Jan 19, 2015
Home loan rates set to fall, after reduction in repo rate Jan 16, 2015
News Archive