The government is looking at taking the
legislative route, by next month, to finalize the setting up of Postal
Bank of India and will soon approach RBI to consider the postal
department's application for banking license.
In a recent meeting chaired by Prime Minister
Narendra Modi, the Department of Posts (DoP) said
According to a presentation given to the Prime
Minister, DoP, in consultation with the government, may approach RBI this
month to consider its original application for a universal bank, the source
said.
"Simultaneously, modalities for the
alternative of taking the legislative route to set up Postal Bank of India
(PBI) would be worked out in February," the source said.
The meeting, which was also attended by Communications and IT Minister Ravi Shankar Prasad, discussed the proposals of the 'Task Force on Leveraging the Post Office Network' and the way forward to implement the recommendations.
The meeting, which was also attended by Communications and IT Minister Ravi Shankar Prasad, discussed the proposals of the 'Task Force on Leveraging the Post Office Network' and the way forward to implement the recommendations.
The Reserve Bank of India (RBI) in
August last year said that the Union government has to take a final call
on application for banking licence by DoP.
The sources said to begin with, DoP
proposes to have Post Office Savings Bank (POSB) to run parallel to the
PBI, which can eventually become part of the PBI as suggested by the Task
Force.
The source said post offices as front of PBI
shall offer full banking services to the customers whereas PBI branches
shall only handle the back office operations such as processing of loan
applications, credit worthiness and risk assessment, investment
operations etc.
"PBI will also offer the facility
of opening institutional accounts, like for panchayats, micro credit
agencies, along with new schemes and market linked rates," the
source added.
Modi had set up the Task Force in 2014 to
leverage the postal network in India and to enhance the role of India
Post in financial inclusion, among other services like delivery of goods
for eCommerce firms.
In December last year, the Task Force
had submitted its rport to Prasad. It noted that with its Rs 6 lakh crore
in deposits, India Post is second only to the country's largest bank SBI.
The report suggested that the government
should set up a holding company under the DoP for immediate roll out of
banking, insurance and e-commerce services.
The holding company should have five different
verticals, and three of them -- banking, insurance and e-commerce -- can
start working immediately.
The panel had suggested establishing PBI as a
separate entity with a branch in each district in the first three years
with initial capital of Rs 500 crore to be funded by the government.
PBI and Prime Minister's Jan Dhan
Yojanacan compliment each other for financial inclusion, former Cabinet
Secretary TSR Subramanian, who headed the task force, had said.
Source : http://economictimes.indiatimes.com
