The department of posts will formulate a detailed project report for setting up a bank, in the XII Plan.
“The postal department has already conducted a study and has found that the proposal is feasible. DPR (detailed project report) is the next step to chalk out the exact blueprint for the model,” a senior official from the department of posts (DoP) told Business Standard.
The department will apply for a banking licence from the Reserve Bank of India. Post Bank of India may be set up with the required authorised capital of Rs 700 crore, the official added.
“The plan is to offer banking services in rural and semi-urban areas by converting our post offices into banks. The department has about 1.5 lakh post offices across the country, which is mainly located in rural areas,” a source said.
The department also operates the Post Office Savings Bank, where it has over 240 million savings accounts. It has a customer base of over 23.75 crore with an outstanding balance of Rs 6,19,611 crore as on March 31, 2011.
The postal department offers schemes such as savings account, recurring deposit, time deposit, monthly income account scheme, postal life insurance, public provident fund, Kisan Vikas Patras and National Savings Certificates.
The feasibility report has already laid out ownership, capital and organisational structure, as well as new product and services to be offered, among others.
According to working group report for XII Plan, the demand for rural banking is particularly high with only 39 per cent of households covered by institutional banking. Globally, postal organisations have transformed financial services into banks successfully. The global firms include Deutsche Post Bank, Japan Post Bank, Kiwi Bank, La Banque Postale (France).
The department is also focusing aggressively on its postal life insurance product. According to the information with the postal department, the department has about 5 million policies under postal life insurance with an assured amount of Rs 58,132 crore, while under rural postal life insurance; it has about 13 million policies with an assured amount of Rs 67,162 crore.
The PLI has been clocking an average growth rate of 32 per cent in terms of premium income while the growth rate of RPLI stood at 60 per cent in terms of premium income in 2009-10 over the previous year.
kudos for the department that atleast now they have woken up to the changing times. The foray in the banking and exclusive insurance should have been made much before as india post is more than 150 years old entity. my biggest doubt will the momemtum gain strength and can we get a post bank atleast in 2 years time from now?
basic plotform is already existing ...awaiting for postal bank a real most welcome project.. service to rual through postoffice is most worthy project and has to be handled with right people in right way and manner... hoping for better times...being a member of india post.
Employees of Postal department should be entrusted to work in PLI/RPLI branches exclusively after necessary training.Posts of Field Officers should be created at divisional ,subdivisonal and block levels to procure business to the department. Exclusive counters for PLI/RPLI work are also required to be created in bigger post offices to faciltate customers.
Content Guide
