RBI Governor talks about payment banks
Posted on: 21/Aug/2015 10:31:43 AM - No. of views : (1533)
The Governor of the Reserve Bank of India (RBI) Raghuram Rajan has said that they will issue licences to small finance banks soon. The RBI had recently approved payment banks. The license for smaller banks is expected to be given from next month. Payment banks may be competition for other banks in the interests given. These banks are allowed to collect deposits upto Rs. 1 Lakh.
Addressing bankers, Mr. Rajan said, New payments banks would not pose any competitive threat to the existing banks and these new entities would rather serve as feeder for the universal banks... (I do) not want to create a situation where high prices would rule in the real estate by bringing down interest rates below the base rate. Developers are sitting on plenty of unsold stock... The transmission of interest rate cuts is taking place through the markets... Credit growth figures are misleading because corporates are tapping the markets for cheaper rates. Competition from the markets is much stronger and banks will lose business.
