FinMin favours real estate, broking firms to set up banks
boards of banks has not been satisfactory. It will therefore be necessary to ensure that any entity/ group
undertaking such activities on a significant scale is not considered for a bank licence," the guidelines added.
The Finance Ministry has also suggested that the Non- Operative Holding Company (NOHC) may be substituted by the Non-Operative Financial Holding Company (NOFHC) to signify that only financial sector entities are part of the NOFHC.
RBI will regulated financial holding company and different entities under the holding company will be regulated as per the business they carry out, sources said.
In its recommendations, the ministry has also proposed to lift the ban on setting up of new financial services entities under the NOFHC for at least three years from the date of commencement.
It has also favoured RBI's proposal of opening 25 per cent of branches in unbanked areas of the country.
"The bank shall open at least 25 per cent of its branches in unbanked rural centres (population up to 9,999 as per 2001 census) to avoid over concentration of their branches in metropolitan areas and cities which are already having adequate banking presence," the draft guidelines had said.
