India Post, the Indian department of posts, which has been offering services like savings accounts, postal life insurance, pension payments and money transfer, will soon have its own full-fledged bank.
The Post Bank of India (PBI), as it is likely to be called, will start operations once the department obtains approval from the Cabinet and banking licence from the Reserve Bank of India.
According to Kamleshwar Prasad, member of Postal Services Board, Delhi, who was in Gujarat to attend an official function, a feasibility study for setting up the PBI has already been carried out and the proposal is now in an advanced stage. He said though the department had enough manpower to handle the new tasks, the staff strength was being increased further to successfully deliver services of government social welfare schemes “in the most efficient and reliable way at the lowest cost due to its reach.” The postal department has 500,000 employees attached to 155,000 post-offices, much more than India’s largest bank, the State Bank of India (SBI), which has 12,500 branches. Even the number of branches of all scheduled commercial banks put together totals only 75,000. There are 9,500 post-offices in Gujarat alone.
The PBI will provide banking services, including accepting of deposits from the public for lending or investment. In addition to deposit schemes, the PBI will also provide loans to general public and corporates like any regular bank.
PBI will become an additional source of revenue generation for the department, besides creating a platform for financial inclusion programme of the government.
Currently, the department operates seven small savings schemes through a network of post offices and collects huge amounts for both state and federal governments from 250 million account-holders, with outstanding balance of some Rs6,000 billion.
Also, with the postal department on an info-tech modernisation drive, it will embark on a pilot project to network all post-offices in Tamil Nadu for later setting up about one hundred ATMs in post-offices.
Source : http://www.khaleejtimes.com