Moving a step closer to setting up a banking business, the Department of Posts has started scouting for a consultancy firm to prepare a road map for the proposed ‘Post Bank of India’ (PBI).
The Department has already carried out a feasibility study for setting up the Post Bank of India and has invited expression on interest from consultancy firms — domestic or foreign — to finalise the plans for the bank.
The DoP, according to an official document, “intends to obtain approval from the Cabinet and licence from RBI for creation of a full-fledged bank (PBI).”
The consultancy firm will provide inputs on issues like the organisational structure of PBI, requirement of seed money and its relationship with post offices.
The proposed PBI will provide banking services, including accepting of deposits from the public for the purpose of lending or investment.
The PBI will aim to “provide banking services with special focus on rural areas...ride on the Core Banking Solution which is proposed to be provided in all the post offices.”
PBI will also become an additional source of revenue generation for the DoP, besides creating a platform for financial inclusion programme of the government.
Currently, DoP operates seven small savings schemes through a network of 1.54 lakh post offices and collects huge amounts for both state and central governments. It has over 250 million account holders.
In addition to deposit schemes, the PBI will provide loans to general public and corporates like any regular bank.
Keywords: Postal Service, India Post, PBI, Post Bank of India
It will generate new employment opportunities for the youth in rural
villages and post offices would be geared to technology enabled banking
with new concepts.Besides post office can accept all kinds of receipts
and payments of state and central government taxes,bonds,etc.,
If post office give good and smart services future will be very very
bright.
This is really welcoming. Postal banking will be appreciable all over
the India. The government should need good infrastructure for effective
banking and security.
I personally feel that it is a giant leap that is much required in today's scenario to meet the banking needs of rural India. Most of the nationalized banks have already identified the untapped potential of rural India and are slowly trying to amass the same by opening smaller branches in smaller towns. But the rate at which this development is taking place is quite slow as compared to the rate of growth of banking needs in such areas. Given the already existing infrastructure and basic, if not state-of-the-art, set up of Post offices in most of the villages, DOP would not find it difficult to improvise these Post offices to turn them into fully functional banks. DOP would be a step ahead of all these nationalized banks while the latter are still deciding on the geographical locations and infrastructure set-up. However, still, its not a easy road ahead. DOP would need to be operationally more efficient by removing bureaucratic red-tapism and strategically ahead to compete other banks.
Such concepts are quite common in Europe. Post Offices offering full-fledged Banking Solutions. Just pick any European Country like Germany, France Switzerland or Italy and make a MOU to understand how the system functions in their country.
There is no need to invite any consultancy for this purpose to waste tax money. Better option would be to give 25% stake to "Die Post Bank" from Germany (simultaneously take 10% stake in Die Post from Germany) and have all the Banking Technologies transferred from Germany to India.
China has emulated many concepts from Germany like Banking, Health Insurance, Intellectual Property System and Many more. So better join hands with German Post Bank and make things work faster in India.
As there are quite large firms from Germany located in South India, make Chennai as the Head Quarters of the Post Bank of India. I hope our DMK Ministers will request the UPA Chairperson in this regard. Also our Congress MPS from Tamil Nadu should support this.
It is an effective way for financial inclusion. India Posts got reach in evey nook and corner of India. They can take the banking services where the banks failed to provide. Also india post can diversify their activities and make themselves viable entity in an era of electronic communication.
Post Bank of India
This is a nice step as there are no banks, except State Banks, which are ready to go rural. They already have deep penetration in india which would work to their advantage.
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