Dubai-based bank gets a principle nod from Indian subsidiary: The key things to know

The Reserve Bank of India (RBI) said on Monday it has decided to grant principle approval to the UAE NBD Bank PJSC to establish a wholly owned subsidiary in India. Emirates Airlines NBD Bank PJSC is a lender owned by the Dubai government.

The nod of the central bank in India is being subject to a plan to establish a wholly owned subsidiary of the country's foreign bank.

The development was at a time when Emirates Airlines NBD Bank PJSC was conducting banking in India in a branch model.

Currently, UAE-based lenders have branches in Chennai, Gurugram and Mumbai, India.

In principle, the license will allow Dubai-based lenders to establish subsidiaries by converting their existing branches in India.

The Reserve Bank of India has approved the principle of Emirates Airlines NBD Bank PJSC: What is next?

The Reserve Bank of India will now consider granting licenses to UAE-based lenders to enable it to start banking under Article 22(1) of the Banking Regulation Act 1949 in a fully owned subsidiary model.

According to the central bank, the issuance of the license will be subject to banks that meet the necessary conditions of the Reserve Bank of India.