In order to increase financial inclusion in the country, NITI Aayog has suggested to create a postal bank or postal bank. Apart from this, the Commission has made several recommendations including merger of Regional Rural Banks (RRBs) with the government.
The terms of the bank license should be simplified
According to sources, in the recent presentation to the Prime Minister’s Office and the Finance Ministry, the NITI Aayog has made several suggestions. It said that 1.5 lakh post offices in the country should be made the outlet of the proposed postal bank. Apart from this, the think tank has said that the conditions for granting bank licenses should also be simplified.
Privatization of three banks
In another recommendation, NITI Aayog has suggested privatization of three banks. According to sources aware of the matter, NITI Aayog has suggested privatization of Punjab and Sindh Bank, UCO Bank and Bank of Maharashtra. These suggestions have come at a time when the new disinvestment policy is under consideration. The government is already considering bringing the banking and insurance sector into the new disinvestment policy.
Currently 12 government banks in the country
The government may face criticism from privatization of public sector banks. In addition, bank unions can also protest. The recent merger in the banking sector took effect from 1 April itself. Currently, there are 12 state-run banks in the country, while in 2017, they were 27. While announcing the Self-Reliant India Package in May, Finance Minister Nirmala Sitharaman had said that the government would soon introduce a new public sector enterprises policy and all sectors would be opened to the private sector.