{"id":1297735,"date":"2025-07-15T08:44:34","date_gmt":"2025-07-15T03:14:34","guid":{"rendered":"https:\/\/trak.in\/stories\/?p=1297735"},"modified":"2025-07-15T08:45:09","modified_gmt":"2025-07-15T03:15:09","slug":"licenses-for-new-banks-can-be-soon-approved-by-govt-of-india","status":"publish","type":"post","link":"https:\/\/trak.in\/stories\/licenses-for-new-banks-can-be-soon-approved-by-govt-of-india\/","title":{"rendered":"Licenses For New Banks Can Be Soon Approved By Govt Of India"},"content":{"rendered":"\n<p>India is preparing for a major overhaul of its banking sector to align with its ambitious goal of becoming a developed economy by 2047. According to a Bloomberg report, the <strong>Finance Ministry and RBI are in talks<\/strong> to issue <strong>new banking licences<\/strong> after nearly a decade, aiming to expand the number and size of Indian banks.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"576\" src=\"https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/07\/Indian-Payment-Banks-small-1-1280x720-1-1024x576-1.jpeg\" alt=\"Licenses For New Banks Can Be Soon Approved By Govt Of India\" class=\"wp-image-1297742\" srcset=\"https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/07\/Indian-Payment-Banks-small-1-1280x720-1-1024x576-1.jpeg 1024w, https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/07\/Indian-Payment-Banks-small-1-1280x720-1-1024x576-1-300x169.jpeg 300w, https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/07\/Indian-Payment-Banks-small-1-1280x720-1-1024x576-1-768x432.jpeg 768w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>New Licences After a Decade: What\u2019s on the Table<\/strong><\/h2>\n\n\n\n<p>India last issued fresh banking licences in 2014. Now, officials are said to be considering:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Allowing <strong>large business houses<\/strong> to apply for licences with ownership restrictions.<\/li>\n\n\n\n<li>Encouraging <strong>NBFCs to convert<\/strong> into full-service banks.<\/li>\n\n\n\n<li><strong>Merging smaller banks<\/strong> to form larger, more capable institutions.<\/li>\n\n\n\n<li><strong>Relaxing FDI rules<\/strong> in state-owned banks to attract foreign capital.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Why India Needs Bigger, Bolder Banks<\/strong><\/h2>\n\n\n\n<p>Currently, only <strong>State Bank of India and HDFC Bank<\/strong> rank among the top 100 global <a href=\"https:\/\/www.indiatoday.in\/business\/story\/new-bank-licence-rbi-government-plan-likely-report-2754342-2025-07-11\">banks by assets<\/a>. To fund infrastructure, manufacturing, and digital growth, India needs banks that can:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Lend for longer durations.<\/li>\n\n\n\n<li>Serve rising credit demands.<\/li>\n\n\n\n<li>Support ambitious GDP expansion from the current $3.7 trillion to $7\u201310 trillion over the next 20 years.<\/li>\n<\/ul>\n\n\n\n<p>The push is also driven by <strong>Prime Minister Modi\u2019s 2047 goal<\/strong> \u2014 transforming India into a fully developed economy, which would require <strong>increasing bank credit from 56% of GDP to 130%<\/strong>, according to experts.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Challenges and Safeguards<\/strong><\/h2>\n\n\n\n<p>The idea of allowing industrial houses into banking is <strong>controversial<\/strong>. It was banned in 2016 due to concerns over connected lending. If reintroduced, it will likely include strict safeguards on <strong>shareholding, governance, and risk management<\/strong>.<\/p>\n\n\n\n<p>RBI Governor Sanjay Malhotra recently confirmed a review of the <strong>licensing framework<\/strong>, indicating momentum toward reform.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Global Interest Grows<\/strong><\/h2>\n\n\n\n<p>Foreign investors are watching closely. In May 2025, Japan\u2019s <strong>Sumitomo Mitsui Financial Group acquired a 20% stake in Yes Bank<\/strong>, marking the largest-ever foreign investment in an Indian bank.<\/p>\n\n\n\n<p>If reforms move forward, India\u2019s banking sector could become <strong>more competitive, better capitalized<\/strong>, and capable of funding its future \u2014 at scale and with resilience.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n","protected":false},"excerpt":{"rendered":"<p>India is preparing for a major overhaul of its banking sector to align with its ambitious goal of becoming a developed economy by 2047. According to a Bloomberg report, the Finance Ministry and RBI are in talks to issue new banking licences after nearly a decade, aiming to expand the number and size of Indian [&hellip;]<\/p>\n","protected":false},"author":30,"featured_media":1297742,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[8284],"class_list":["post-1297735","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-new-banks"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.9 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Licenses For New Banks Can Be Soon Approved By Govt Of India - Trak.in - Indian Business of Tech, Mobile &amp; Startups<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/trak.in\/stories\/licenses-for-new-banks-can-be-soon-approved-by-govt-of-india\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Licenses For New Banks Can Be Soon Approved By Govt Of India - Trak.in - Indian Business of Tech, Mobile &amp; Startups\" \/>\n<meta property=\"og:description\" content=\"India is preparing for a major overhaul of its banking sector to align with its ambitious goal of becoming a developed economy by 2047. 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