When Reserve Bank of India (RBI) invited applications for bank licences four years back, more than two dozen entities tried their luck. As the central bank moves to put licences on tap\u2014the guidelines were announced on Monday\u2014it\u2019s unlikely there will be more than a dozen applicants. While some of the rules in themselves can be onerous\u201425% of branches, for instance, must be located in unbanked areas\u2014the bigger concern right now would have to be the relatively low visibility on how exactly the use of technology will change the way banking transactions take place in the years ahead as India transitions, albeit very slowly, to a cashless economy. Few would have anticipated the fairly rapid transformation in the banking space over the last three years driven by the use of technology, especially via mobile telephony. The emergence of fintech\u2014essentially a new set of players that is facilitating electronic payments, sourcing loans online or creating platforms where borrowers and lenders to meet\u2014had certainly not been foreseen. So while a banker will continue to pretty much do what he has been doing for years\u2014borrowing and lending to earn a spread\u2014there will be far greater use of technology whether customers are being tapped for deposits or being sold loans. Already there are concerns some of the smaller state-owned banks may not be able to keep pace with their more nifty private sector peers in putting in place a technology-friendly apparatus that both young and even not-so-young customers want these days. Wallets set up by banks may not have seen too much money come their way but no bank wants to be caught without one. Against this backdrop, it might appear newcomers have an advantage in that they would not be weighed down by legacy branch networks or big workforces and can quickly build a platform based on state-of-the-art technology. It is true some of the Non-Banking Financial Companies (NBFCs) are well-placed to become banks; they are lenders already both to companies and to individuals and, therefore, are experienced. Many of them tap individuals for borrowings and the ability to access low-cost deposits would help them improve their spread. However, as analysts point out, some will not be eligible because the rules disallow NBFCs that belong to a group with total assets or gross income of R5,000 crore or more and which have non-financial businesses exceeding 40% of total assets or income. For others, the cost of conversion could be high not merely because they would need to lend to the priority sector and meet cash and liquidity ratios, but because they must compete with existing private sector banks who already have built a brand and a customer franchise. While on paper the opportunity may seem huge the fact is the best of the customers\u2014both corporate and retail\u2014have been taken. Tapping the remaining catchment for business is not impossible but not easy. The central bank appears to be encouraging professionals to set up shop but for them too the playground is just as competitive.