Bank Licenses Another cash cow

Bank Licenses will give more opportunities for the Govt to exploit the economy in several ways. The aspirants for bank licenses are mostly Corporates having diversified interests which include even real estate business. Since banks are highly leveraged institutions, the access to money for the avaricious and greedy industrialists is unlimited and there has always been a nexus between politicians and Industrialists to exploit the economy. The election is also round the corner.The desire to improve financial inclusion is only a sugar quote and if the Govt and RBI are serious on Financial Inclusion the existing banks themselves can be made to achieve that. Unfortunately, our masses are illiterate and they can be easily fooled by some cheap gimmicks. The present approach to banks Licensing may turn out  to  be another gimmick and some industrial groups may get the license to prove to be a major head ache later on. This article is definitely a warning and has perhaps come out of the past experiences the economy had.

Dr.T.V.Gopalakrishnan

(This comment appeared in ET dated 15/5/13 in response to the article After Telecom licenses and Coal Blocks will bank licenses be the next cash Cow?)