Amid indications of the government and RBI gearing up to grant new bank licences, Reliance Capital has said it is full-prepared from its side to foray into the banking business.
"We are ready. We have been working on this for quite some time... for about one and half years," Reliance Capital CEO Sam Ghosh told PTI in an interview.
Reliance Capital, the financial services arm of Anil Ambani-led Reliance Group, has been one of the major aspirants of the new banking licences to be granted by the Reserve Bank.
While the process of granting new banking licences have been underway for quite some time, the government has recently indicated that a framework could be put in place soon for allowing new players in this business.
The RBI had issued draft guidelines in August 2011 for issuance of new banking licences, while in July 2012 it released the comments and suggestions received by it.
Asked about the group's banking aspirations, Ghosh said that final regulatory framework is yet to come on this front, but Reliance Capital was certainly fully prepared on its part.
"We are ready to the extent of the current scenario and once the final guidelines come up, we will be in a better position to understand the situation," he said.
Asked whether it would be good to have new banks, Ghosh said that the country has an estimated 200 million bank accounts, while there are about 600 million mobile customers.
"So, there is clearly a big gap and there is a need to take banking to a larger number of people," he said.
"When it comes to the question that whether there is a case for merging smaller banks with the larger ones, the consolidation should also be good for the industry," he said.
For the new banks, the draft guidelines are, however, clear that the new licensees would have to have a proportionate presence in the rural areas and they cannot limit themselves to urban centres, Ghosh said.
He said that all banks would need large amount of capital and it would help if consolidation takes place. Asked whether Reliance would consider an acquisition, Ghosh said that draft guidelines do not allow such a move.
Along with Reliance Capital, a number of other private players including Religare, L&T and Shriram are eyeing a banking licence for a long time.
Addressing Reliance Capital shareholders last year, Chairman Anil Ambani had said that the group's banking entity could be called 'Reliance Bank'.
The group is present in a host of financial services segments including insurance, asset management, NBFC and financial products distribution, among others, and the banking remains one of the few businesses missing from its portfolio.