Public sector unit, Power Finance Corporation (PFC) is planning to enter into banking segment following the discussion paper released on new banking licenses by the Reserve Bank of India.

PFC, which is a non banking finance company (NBFC) will be appointing consultants for the purpose.

"Consultants will be appointed shortly. They will look at the possibility of converting PFC into a bank," a senior official said.

The company was founded in the year 1986 in order to facilitate the power and other sectors.

The RBI's discussion paper on new private banks said, "Since NBFCs are already regulated by the RBI and have a track record, the ‘fit and proper' concerns could be addressed more easily.

"The NBFC model, particularly for those in lending activities, has been successful in expanding the reach of the financial system and, thus, by converting to banks, this model could be scaled up to better leverage the benefits and achieve the objective of financial inclusion," it said.