Ajay Shan and Subho Roy have this food for thought post on the recent licening of payments banks in India. Interestingly, they think bank licencing process is quite similar to the questionable coal block allocation process. This blog had also raised concerns
Obviously given the hype around Indian central bank, this post is likely to be ignored. Worse they call bank licencing similar to the coal allocation process:But it speaks volumes about the so called secretive processes in Indian central bank. It refuses to learn from its less hyped sibling which has more transparent but less celebrated set of processes. This blog had also raised concerns over this licencing. The chair of the committee recommending such banks was licencing them as well!
The authors list three practices for such licencing – first where there is free competition between banks and tech companies in payments space. Second where there is a proper code of licencing such entities. Under this, the one who is rejected is given a chance for appealing and hearing its case. Third is the secretive route of committees which RBI has followed where there is limited accountability. Only a press release which has rosy words suggesting stringent measures have been adopted while selecting such entities.






