Post offices to turn into virtual banks with Gen-X facilities

Depositors in post offices in Andhra Pradesh will have a welcome change shortly with the Department of Posts gearing up to launch ATMs and Core Banking Solutions (CBS) like commercial banks.

As part of IT Modernisation Project, India Posts has tied up with Infosys as technology partner to offer post offices with modern tools and technologies.

“After encouraging response to two branches at Tekkali and Srikakulam among 70 across the country where we introduced CBS, we have decided to introduce the facility at good number of post offices in Visakhapatnam division in next three to four months,” Director of Postal Services Vennam Upender, told

The Hindu .

One can have transfers and withdrawals from any branch in a post office where CBS facility is available. The Visakhapatnam division comprising Visakhapatnam, Srikakulam, Vizianagaram and East Godavari has 2,700 post offices, which could mobilise deposits worth Rs.4,000 crore during the last fiscal registering a growth rate of over 30 per cent.

Mr. Upender said as part of modernisation, the Department of Posts with good base in the rural areas, had decided to introduce e-banking and Internet banking virtually competing with Gen-X banking institutes. Recurring deposits, postal insurance and public provident fund schemes are most sought-after. Through postal insurance, a premium of Rs.71 crore was raised in the division during 2013-14.

He said for rural postal life insurance facility, one need not be an employee and it ensures high returns at low premium. “As overhead costs are low, we are able to offer better returns to the investors. Under senior citizens savings scheme, we are offering a quarterly interest of 9.2 per cent, which is one of the best in today’s market,” he said.

Upgrading post offices with new ambience to ensure ‘look and feel’ component, ‘Project Arrow’ has been launched. He said despite competition posed by courier services the client base of speed post had gone up due to guaranteeing of ‘track and trace’ on real time basis.