Reserve Bank of India the controller of the banks in India is now thinking to relax its restriction on the other commercial banks. This seems to be a good and healthy sign of the development of banking sector in India and hope to get more foreign exchange investments in banking sector.
Banks in India(including foreign banks)need not wait for Apex bank of the nation to approve its new branch opening nor wait for its license to open a new ATM.This is the on going discussion in the minds of central bank of India.
A larger part of the finance department is with the view that both Indian banks and foreign banks must be treated equally. so that its easy the for sub continent to meet its unmet ends in the field of banking.
We should give equal rights to foreign banks and instead of waiting for other nations to do the same.so that we easy attract more investors so that purpose of banking to attract investments and to lend loans happens very easily.
Same time, I hope RBI will vest its power to control the commercial banks so that it can easily control the banks if RBI finds commercial banks to be out of their way. Most attractive feature of this is it can easily liquidate money so that it will help RBI to handle the financial crunch.
RBI circle says that liberalization of banks is has been suggested by various panels including the very resent RAGHURAM RANJAN panel. RBI also speaks that, this is not a way to address the present financial crunch.
Another information form the side RBI is that, this is a way to have healthy growth and good competition. RBI can have the right to impose restriction for some reasons and this must be an exception and not a norm.
This relaxations may find an improvement in banking sector. Like those banks which have a lot of branches in south can concentrate its improvement the other part of the nation.
A notable point is that this relaxations may not have much impact now because most of the banks now are facing a major financial problem. This will have a great use after the time of recession, it will also prevent banks form falling into deep recession, as we saw that those banks which have a lot of branches didn't fall in the trouble of recession as compared to those branches which had less number of branches.
This is one way to have a good banking facility in rural areas. This relaxation has paved many ways of development and seems to have a good sign in banking sector. Might be its one good step taking by the central bank improve banking and also to have investments and to make the basic purpose banking easy. I feel this step will take banking facility as well as banking sector to have a good growth.
