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India Post prefers ‘full-fledged bank licence’

BEENA PARMAR  MUMBAI

Government-owned India Post official on Thursday expressed its desire to become a universal bank, at a time when RBI has suggested it to apply for a payments bank.

“The RBI needs to see whether it wants to give a full service bank or a payments bank licence. The Department wants a full-fledged bank,” said Pradipta Kumar Bisoi, Chief Postmaster General, Department of Post.

The RBI said it is due to release final guidelines on payment and small banks by this month end. India Post (also known as Department of Post) is one of the front runners in applying for the licence.

Speaking on the sidelines of an event, Bisoi said, “We are already doing (what) a payment bank (does)…So, we don’t know the difference between what the department is doing right now and what the payment bank is.

According to him, a high-powered committee has been formed three months back including former cabinet secretary TR Subramaniyam and Mohandas Pai among others to give recommendations by the end of this month. Hence, the application of the licence will depend on the committee and the Government.

Bisoi also told reporters that the Department has stopped the deployment of ATMs, which it had started earlier this year, due to some technical issues.

To become a universal bank, Bisoi said the Department will have to do some work around upgradation in terms of technology and employees. “It is for the government to decide what and when to apply,” he added.

In its attempt to become a bank, the government entity is also growing its electronic money order and mobile money transfer from the physical one, post office saving deposits, postal life insurance, offering services to book railways tickets and tying up with e-commerce firms among other services to “make post offices a one-stop solution”.

Recently, Communication and IT Minister Ravi Shankar Prasad had said India Post, with the world's largest postal network and its unparalleled rural reach, was best suited to offer delivery services to e-commerce firms.
The government is investing Rs. 5,000 crore for the IT modernisation of India Post. “We have about 800 offices across the country already under core banking services and 25,000 of the total 155,000 will come under core-banking and the rest will be linked by the end of next year,” Bisoi said.

We are also looking at giving hand-held devices to over 150,000 post offices in the rural areas,” he added.

Currently, India Post has a total deposit base of about 6 lakh crores.

(R.B.KISHORE)