Post offices moved a step closer to
becoming banks. The government has allowed certain eligible branches to
issue ATM cards to their account holders and also account statements
instead of giving out passbooks, as most private sector banks do.
On Tuesday, the government issued a
gazette notification amending the Post Office Savings Bank General
Rules, 1981. The rules will come into force immediately. These
facilities will be available to the branches that are working on core
banking solution software, essentially branches that part of an
electronic network.
Post offices currently provide savings
account, recurring deposits, fixed deposits and many other small savings
schemes run by the government including the popular Public Provident
Funds.
The funds raised by them largely go to
finance central and state governments. India post currently has about
1.55 lakh branches, nearly 90% are in the rural areas, which many
experts see as a good vehicle for financial inclusion. The notification
says the post office savings bank could issue automated teller machine
or debit card to account holders on request or otherwise which can be
used to withdraw funds from any of the branches having core banking.
The deposits to these accounts could be
made and accepted through any electronic mode. The RBI had decided
against issuing a banking licence to India Post when it gave out licence
to IDFC and Bandhan Financial Services saying it would decide after
consultation with government. The new rules notified by the government
will push India Post closer to banks.
Source : The Economic Times
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