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India announces first bank licences in a decade

Published on Apr 3, 2014 12:38 AM
 
File photo of the Reserve Bank of India (RBI) head office in Mumbai. India on April 2, 2014 announced it was issuing two new bank licences for the first time in a decade as it accelerates a push to bring more Indians into the formal banking system. -- PHOTO: AFP

NEW DELHI (AFP) - India on Wednesday announced it was issuing two new bank licences for the first time in a decade as it accelerates a push to bring more Indians into the formal banking system.

The Reserve Bank of India (RBI) announced "in-principle" approval for Mumbai-based IDFC, a major infrastructure project lender, and microfinance company Bandhan Financial Services, located in eastern India, to establish banks.

Just 35 per cent of Indian adults have bank accounts, a figure which the RBI calls "miniscule" and says shows a "crying need for a further push to the financial inclusion agenda" to include India's poorest.

Under their licences, the new banks must open 25 per cent of their branches in rural areas that have no banking services.

 
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