Plan panel against telecom operators setting up banking cos

Prakash Chawla

Davos, Jan 27 (PTI) India''s Planning Commission is not infavour of allowing telecom operators to float bankingcompanies as it could lead to financial problems.

"We actually have a different view...we are not in favourof (telecom companies becoming financial companies),"Planning Commission Deputy Chairman Montek Singh Ahluwaliasaid at a CII function in the annual WEF meet here.

In India, he added, "We are very much in favour oftransactions being done by banks at the end of the day...bankstake account of what is happening...we do not want financialcrisis".

The government, however, has been trying to set up aframework to allow people to undertake basic operationsthrough cell phones, but that would not allow telecomcompanies to become banks themselves.

An inter-ministerial group has recently submitted areport to Telecom Regulatory Authority of India (Trai)recommending that people in remote areas be allowed to openaccounts linked to their cellphones and withdraw money up toRs 5,000 a day.

India has around 65 crore mobile phone subscribers, witha number of them in unbanked areas.

Many banks are providing mobile banking facility in thecountry. The country''s largest lender State Bank of India tiedup with Airtel to provide banking facility through the use ofmobile phone. Besides, ICICI Bank also tied up with Vodafoneto offer similar services across the country.