RBI has released certain clarifications on the guidelines issued for licensing of new banks. Based on the feedback received from interested entities, RBI has increased the validity period of the in-principle approval for setting up of banks from one year to 18 months. In a press release issued in Mumbai yesterday, RBI said that intending applicants have brought out several complex issues pertaining to reorganization of the existing corporate structure, restructuring of businesses and meeting the regulatory requirements.RBI Deputy Governor K C Chakrabarty said in Mumbai that customer service in the banking industry will be better if more banks come in as it will drive competition. He also said the number of homegrown domestic banks is less than the number of foreign banks present in the country.RBI had released the Guidelines for Licensing of New Banks in the Private Sector in February this year. Accordingly, RBI had said that corporates and public sector entities with sound credentials, 500 crore rupees capital and a minimum track record of 10 years would be allowed to enter the banking business. The last date to submit applications is 1st July 2013. RBI had also invited queries from intending applicants seeking clarifications on guidelines.