The Department of Posts
(DoP) will soon seek Cabinet approval for Rs 240 crore for setting up Post Bank
of India.
The DoP has plans to set up Post Bank of India
under payments bank licence. The Reserve Bank of India has already issued
licensing norms for niche banks -- payments banks and small banks.
The DoP, which has applied for a payments bank
licence, has a hybrid model in mind to operate Post Bank of India. Reserve Bank
Governor Raghuram Rajan yesterday had said while the banking sector is set to
undergo changes in the next few years, "we are going to possibly have
postal bank".
"The Department is in the process of seeking
approval for about Rs 240 crore from Expenditure Finance Committee which will
then need nod from Cabinet," an official source told PTI.
As per RBI guidelines, payments banks would offer
a limited range of products such as demand deposits and remittances. They will
not be allowed to undertake lending activities and will be initially be
restricted to holding a maximum balance of Rs 1 lakh per individual customer.
They will be allowed to issue ATM or debit cards
as also other prepaid payment instruments, but not credit cards.
According to a source, Communications and IT Minister
Ravi Shankar Prasad has approved hybrid model suggested by Ernst & Young
which prepared detailed project report on Post Bank of India (PBI).
"E&Y has come out with three models but
suggested preference to a hybrid model. Under which about 600 branches will
directly operated by PBI staff in post office premises and transactions in
other parts of the country will be supported by India post staff," the
official said.
Post Bank of India is proposed to have its own
employees and IT infrastructure. The transaction handled by India Post ,
employees will be entered in to computer server of PBI.
The Department expects revenue of over Rs 550
crore from PBI in first 5 years.