India Post will send a proposal to RBI for its ATMs to work on the platforms of all other banks
Soon people will be able to withdraw money from any bank account -
private or PSU - through ATMs of India Post, as it takes the first step
towards the proposed Postal Bank in the next few years.
Currently, people with accounts in postal department can use the services of the ATM.
India Post, which has already received a license for starting a
Payments Bank, will send a proposal to the Reserve Bank of India (RBI)
for allowing ATMs of India Post to work on the platforms of all other
banks. "We will soon send a proposal for interoperability of its ATMs
with other banks. This would mean technology upgradation in our existing
ATMs," according to a senior official from the department.
The minister for communications and IT Ravi Shankar Prasad has been
taking keen interest in the revival of India Post through various
measures. Currently, about 600 ATMs have been installed across the
country and target is to take this number to 1000 by March this year and
10,000 in the next couple of years. Also, another 20,000 micro ATMs
will be set up in the same period.
"This will promote banking in the rural areas. The plan is to have
one ATM each in all the 1.55 lakh post offices, out of which 1.3 are in
the rural areas, across the country," the official said.
Public Investment Board has already approved Rs 800 crore proposal
from India Post for setting up a payments bank and is now in the process
of finalising a consultant for the same. It is expected to start
operations by March 2017. Subsequently, the plan is to convert into a
full-fledged bank.
In the Budget 2016-17, the government has already announced a massive
rollout of ATMs and micro ATMs in post offices over the next three
years to provide better access to financial services in rural areas.
As on February, India Post has issued 126,181 ATM-cum-debit cards to its account holders.
Also, about 25,000 post offices have been brought under core banking
system, which will allow users to operate their accounts from any post
office. As of now, people have to visit their respective post office
branch to undertake transactions.
Once core banking system is implemented across all post offices by
next year, it will offer users flexibility to visit any branch. The IT
modernization project of post offices is underway with an investment of
about Rs 5,000 crore. India Post has overtaken the State Bank of India
to become India's largest core banking network with 18,231 branches.
Postal department plays a huge role in disbursing wages to Mahatma
Gandhi National Rural Employment Guarantee Scheme (MGNREGS)
beneficiaries. Nearly 6.92 crore MGNREGS accounts have been opened in
post offices up to December 2015 and the number of post office savings
bank (POSB) accounts has increased from 30.86 crore to 33.97 crore,
according to the latest Economic Survey. Because of these reasons, the
department of posts is planning to install ATMs so that it can benefit
even the lower strata of the society.
As many as 25 commercial banks and institutions including Deutsche
Bank, State Bank of India, Punjab National Bank, Axis, Yes Bank and IDBI
have evinced interest in partnership with India Posts for their
Payments Bank venture. Payments bank will be able to products such as
demand deposits and remittances. They will not be allowed to undertake
lending activities and will initially be restricted to hold a maximum
balance of Rs 1 lakh per customer. However, they will be allowed to
issue ATM or debit cards as other prepaid payment instruments, but not
credit cards.
Source : http://www.business-standard.com
