RBI governor Mr.Raghuram Rajan, who granted licences to 21 firms to start small finance banks and payments banks last year, is now exploring more niche categories of lenders as he opens up the tightly regulated sector.
In its bi-monthly monetary policy review statement on Tuesday, the RBI said it will explore possibilities of licensing other differentiated banks such as custodian banks & banks concentrating on wholesale and long-term financing. It added that it will come up with a discussion paper on the new categories by September 2016.
The move comes after the RBI gave out two new licences for retail banking in 2014 and followed it up with a framework for two niche set of banks last year when it permitted 10 firms to start small finance banks and 11 companies to float payments banks. The initiatives were aimed to expanding the reach of the formal banking system in a country where half the population has no access to banking services.
The central bank on Tuesday stopped well short of moving toward putting universal banking licences on tap, as it has previously said to expand the scope of the banking industry, but signaled it would create more categories of banks. This may open up the financial sector to more participants.