The Parliamentary Standing Committee on Finance wants the Reserve Bank of India to drop the move to issue new banking licences.
Many members urged the RBI Governor, Mr. D Subbarao that the new banking licence could open avenues for corruption.
However, few MPs supported RBI's plan, they argued on the fact that the final guidelines will not encourage any one to start a bank.
RBI Governor, Mr. D. Subbarao briefed the panel on the final guidelines to allow corporate houses and public sector entities with "sound credentials and a minimum track record of 10 years" to start banks.
RBI has, so far not received any application, According to the guidelines released on February 22 for new banking licence; the last date of submission of the applications is July 1.