India Post seeking assistance in Post Bank project
India Post is seeking a consultancy to assist it in setting up a new Post Bank of India to provide banking services with a particular focus on rural areas.The proposal is at a conceptual stage, with the Indian government aiming to set up a new platform to provide a broader range financial services in all post offices.
India Post said the project would be a platform for financial inclusion in India, and along with basic money deposit and withdrawals, would provide higher-order value added services beyond those currently available for around 250m existing Post Office Savings Bank account holders.
The Post is now seeking expressions of interest from potential partners to help it develop the project.
India has had a Post Office Savings Bank for more than a century, provided through its network of 154,000 post offices, of which about 25,000 are fully computerised, with a fully networked Savings Bank IT system linked to 11,000 post offices.
The Post says India’s 171 commercial banks have been unable to provide complete coverage in rural areas, with only 36% of their branches outside of urban and semi-urban areas, while almost 90% of India’s post offices are located in rural areas.
The Indian government is aiming for banking facilities to be set up in at least 73,000 villages with a population of at least 2,000.
It has been working on the Post Bank of India project since 2005, with a feasibility study completed in February 2011 backing the creation of such an agency.
India Post said its current expression of interest was for a five-month project putting together a detailed proposal for the creation of the Post Bank, laying out the financial justification for setting it up, and how it would fit with the existing Savings Bank.
The subject of banking services is one of a number of topics for discussion at a two-day conference for heads of postal circles at India Post today and tomorrow.
The Ministry of Communications said today it wants India Post to be a reliable partner for various government departments for delivery of their services in villages where no other network can reach.