Should the RBI Allow Corporate Houses to Own Banks?

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  • Published On: November 24, 2020
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If a proposal by the Reserve Bank of India goes through, corporate entities in India may be allowed to own banks. Is this a good idea? Ratings agencies and some of India's foremost economists and former RBI. governors have said that this is a disastrous idea that throws caution to the wind. Former Finance Minister P Chidambaram says the government is pandering to the ambitions of business houses. There are others, however, who say bank promoters will be ring-fenced and that these additional banking services are crucial given the under-penetration of financial services in India - that this move will create a supply-side push. On Left, Right & Centre, we ask: should the RBI allow corporate houses to own banks?

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