MUMBAI, Nov 13: India Post is interested in turning itself into a universal bank like many of its peers across the world and a committee under former Cabinet Secretary TSR Subramanian is looking into the matter, a senior department official said today.
“We still want to be a full-fledged bank. The government will decide whether they want to give to us or not,” chief postmaster general, Maharashtra circle, Pradipta Kumar Bisoi told reporters here.
“There is a committee under Subramanian which has been formed, they are going to give some recommendations, let’s wait for the report to see whether we should go for a full-fledged bank or a payment bank,” he said.
However, Bisoi added that the department, which has been accepting deposits for many decades and mobilising savings, already works like a payment bank and wondered what is the difference between the work they have already been doing and a payment bank.
“We are already doing (the work like) a payment bank, and I don’t know what is the difference between what we are doing now and what is a payment bank,” he stressed.
The comments come amidst increasing speculation about the department being considered for a licence under the soon-to-be introduced ‘payments banks’ category, rather than as a full- fledged or universal bank with a complete bouquet of offerings.
RBI Governor Raghuram Rajan today said the RBI will invite applications for payment and small banks by the end of the month.
It can be noted that at the time of granting full-fledged licences to infra lender IDFC and micro-lender Bandhan in April after a 12-year hiatus, the RBI had left it to the government to decide on the aspirations of the postal department, which was also one of the over two dozen applicants.
Bisoi said the Subramanian committee, which also has
former Infosys board member TV Mohandas Pai as a member, got formed three months back and will be submitting its report by the end of this month.
According to the draft RBI guidelines, the payment banks will only accept deposits and offer payment services, but will not indulge in lending activities. Applicants will require a capital of Rs 50 crore.
Bisoi said the postal department already has a deposit base of over Rs 6 lakh crore and is expected to have 25,000 offices under the core banking solution (CBS) by the end of the next year.
In support of its claim for becoming a full-fledged bank, the postal department has termed its vast network of over 1.55 lakh post offices as the biggest strength, saying it will help deepen the financial inclusion agenda of the government.
However, these banking aspirations have faced opposition by many on grounds that India Post lacks experience in activities like treasury operations, as also in dealing with technicalities involved in running a bank. (PTI)
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