On Friday the Reserve Bank of India has been recommended by India Inc to allow industrial houses for setting up commercial banks. Swati Piramal, the Assocham president came up with a radical suggestion that the RBI should at least issue fifty to hundred new bank licenses in the first round.

Piramal has said that in the first round at least fifty to hundred new licenses should be issued to bring in competitive mood as happened with the insurance sector.

There are expectations in the sector that around six new licenses would be issued by the Reserve Bank in the first round but Piramal’s announcement of increasing the bet on the issue had sprang surprise.

Assocham also asked that for dilution of stake the promoters should be given ten- years which is a longer period than the existing one. He added saying that it takes time and around thousand crores of rupees to establish and run a business so the shareholding of promoters should not come down quickly.

Piramal further added that to come down to the predetermined ten percent they might need ten years of time.

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In the month of August the RBI had initiated a discussion paper regarding issuance of new licenses and sought opinion on the same till 30, September. The central bank is carrying on with discussions with different stakeholders for taking the process forward.

On Friday Usha Thorat, one of the deputy governor of the RBI led the RBI team and met representatives of Ficci or the Federation of Indian Chambers of Commerce. The body didn’t comment anything on the outcome of the meeting.

The delegates of Ficci comprising of company chairpersons presidents and vice presidents presented their opinions to the Reserve Bank of India.