Government has given its nod to certain branches of Post Offices in the country to not only issue statement of accounts just like banks but also to issue their customers ATM cards. This is a revolutionary step that will benefit millions of customers of post offices in remote and far flung areas of the country where banks have not been able to register their presence. The central government has amended the Post Office savings Bank General Rules Act of 1981 through a gazette notification and this amendment has come into effect immediately. These new rules will be applicable to only a few branches of post office branches across the country, which are a part of an electronic network.
Post Offices serve the very important purpose of financial inclusion
Post offices across the country provide basic banking amenities at present such as allowing people to open savings accounts and operate them. They can also open recurring deposits and fixed deposits in these branches of post offices besides participating in other savings schemes launched by the government. These post offices are no less than public sector banks in raising revenues for state and central governments as people open savings accounts in large number in branches of post offices nearest to them. This money is utilized by the governments to fund their welfare schemes. There are more than 150 thousand branches of post offices in the country and most of them run in rural areas of India. They serve as a very useful instrument for the government of India as they allow for the fulfillment of financial inclusion of the people of the country.
Government is keen on transforming post offices through their modernization
With government allowing post offices to issue debit cards to their customers, people would be able to withdraw money from the ATMs just like customers of public sector and private banks. It must be recalled here that India Post had earlier applied to the RBI to be given a license to operate like a bank but its application was rejected by the RBI on grounds that it needed to consult government on this matter. It is clear that the government has given its approval to the pleas made by the postal department and the new rules will allow post offices to inch closer to become full-fledged banks in future.
The notification by the government says, “In case of an account standing at any post office with a core banking solution platform in place, the Post office Savings Bank shall issue ATM or debit card to the account holder on payment of such fee as may be prescribed by the Central Government.”
Of the 1.55 lakh post offices around the country, 676 provide core banking solutions (CBS) to their customer. The current notification issued by the government is a part of the larger modernization project that it has in mind for the Department of Posts.
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About Sanjay Tandon
Sanjay Tandon is a graduate engineer from IIT Varanasi. He has been writing as a freelancer for many years. He loves to write on various niches. He is passionate about politics and economy and spends his free time watching news channels. He is also an expert on relationships.