Re-launch of sale of KVP (SB order 12/2014)

Kisan Vikas Patra re-launched today

The Union Finance Minister Shri Arun Jaitley has re-launched Kisan Vikas Patra today in a function held at Hotel Ashoka, NewDelhi.  Sri Ravi Shankar Prasad, Union minister for communication & IT, Shri Rajiv Mehrishi, Finance Secretary, Ms. Kavita, Secretary, Department of Posts, Shri Rajat Bhargava, Joint Secretary (Budget), Department of Economic Affairs (DEA),Ministry of Finance and other senior officers of the Ministry of Finance and Department of Posts and National Small Savings Organizations were also present among others on this occasion.

Salient Features of re-launched Kisan Vikas Patra :
1.Amount Invested doubles in 100 months ( 8years 4 months)
2.Available in denominations of Rs 1,000, 5000, 10,000 and Rs 50,000.
3.Minimum deposit Rs 1000/- and no maximum limit.
4.Certificate can be purchased by an adult for himself or on behalf of a minor or by two adults.
5.KVP can be purchased from any DEpartmental Post office. This facility will also be extended shortly to the designated branches of commercial Banks.
6.Facility of nomination is available.
7.Certificate can be transferred from one person to another and from one post office to another.
8.Certificate can be encashed after 2 1/2 years from the date of issue.

Relaunching of Kisan Vikas Patra (KVP) on 16.10.2014

National Savings Institute is organizing a function on 16  th October, 2014 for launching of Kisan Vikas Patra (KVP) in New Delhi. During the function, Department of Posts officials will be awarded for their Outstanding Performance in the field of Small Saving Scheme. For this purpose, nominations has been caled for from each circle

Revision of Interest Rates for Small Savings Schemes w.e.f 01.04.2014

The interest rates on various small savings schemes for the  Year 2014-15 effective from 01.04.2014 are revised as follows with the approval of the finance Ministry.

 

Scheme	Rate of interest w.e.f.01.04.2013	Rate of Interest w.e.f. 01.04.2014
1.	2.	3.
Savings Deposit	4.0	4.0
1 Year Time Deposit	8.2	8.4
2 Year Time Deposit	8.2	8.4
3 Year Time Deposit	8.3	8.4
5 Year Time Deposit	8.4	8.5
5 Year Recurring Deposit	8.3	8.4
5 Year SCSS	9.2	9.2
5 Year MIS	8.4	8.4
5 Year NSC	8.5	8.5
10 Year NSC	8.8	8.8
PPF	8.7	8.7

      

Country's first Post Office Savings Bank ATM opened at T Nagar HO (Chennai) on 27/2/2014

Country's First Post Office Savings Bank ATM  inaugurated by Shri P. Chidambaram, Hon'ble Union Finance Minister, Govt. of India on Thursday the 27th February 2014 at Thyagaraya Nagar Head Post Office, Shivagnanam Road, T'Nagar, Chennai,  Tamilnadu - 600017. 

        In order to meet the requirements and needs of the I.T modernization project, Infosys Core banking Solution (CBS) will be implemented across India covering all the Post offices. 

        
        Core Banking Solution (CBS) - FINACLE is networking all the Post offices which enable customers to operate their accounts and avail Account related services from any Post offices on CBS network regardless of where he/she maintains his/her account. The customer is no more the customer of a particular Post office. He becomes the Post office Savings Bank (POSB) customer. Thus CBS is a step towards enhancing customer convenience through “Anywhere and Anytime Banking”. As Finacle is integrated to all the banks in course of time, the customer can access any bank account through post office.

        Around Rs.700 crore is earmarked for this Project. Core Banking Solution(CBS) for Post office Savings Bank is being implemented throughout India. As on date, 57 Head Post offices and 11 Sub Post offices have migrated covering 64 lakh accounts.  By 31.03.2014, 700 more Post offices will be covered. All the 26,840 Post offices would be functional in CBS by 2016.

Ms. P. Gopinath, Secretary (Posts) with Hon'ble Union Finance Minister Shri P. Chidambaram

 

Hon'ble Union Finance Minister addressing to gathering

 

Shri S. Samuel, Sr. Postmaster, T'Nagar HO with his POSB ATM card

 

Secretary (Posts) and other Postal Offiers in Press Conference

 

CBS Migration in Kerala Circle to start by 10/03/2014

India Post to install 3000 ATMs,1.35 lakh mirco-ATMs by Sept 15

Even as its application to start a commercial bank is pending, India Post has drawn a massive plan to install as many as 3,000 ATMs and 1.35 lakh micro-ATMs at the ubiquitous post offices across the country for savings account holders by September 2015, a top official has said.

 

"We will be starting with three ATMs to be installed in New Delhi, Chennai and Bangalore on February 5 and then ramp it up gradually," postal department secretary Padmini Gopinath told a select group of reporters here over the weekend.

 

She said 1,000 ATMs with the India Post branding will be put in within the first year, which will be ramped up massively to 3,000 in the next 18 months.

 

To start with, the ATMs can be used only by 26 crore savings account-holders who save with the postal department, but Gopinath exuded confidence that within six months of the launch, they will get the interoperability permission from the Reserve Bank.

 

Postal savings are worth around Rs 6.05 trillion, which is half the savings in the largest lender SBI and more than double that of the largest private sector lender ICICI Bank.

 

Through interoperability, India Post will join the National Financial Switch, which will benefit India Post account holders to transact at the banks' ATMs and vice versa, she added.

 

India Post has been working with software major Infosys on this project, she added.

 

The micro ATMs will be handheld devices to be operated at the post office level while the ATM will be similar to the one operated by any commercial bank, she added.

 

The postal department, which has 1.55 lakh post offices over 90% of which are in villages, offers the savings account to people across the country and pays an interest of 4% per annum for such deposits. The account offers cheque facility at present.

 

It can be noted that the Department of Posts is fighting a very contentious battle to convert itself into a full fledged bank, asserting that its reach can help achieve the goal of financial inclusion.

 

However, the finance ministry has expressed some reservations about the idea, while Telecom Minister Kapil Sibal has exuded confidence of winning over his Cabinet colleagues to get the go ahead for the 'Postal Bank'.

Changes in some procedures of POSB in the backdrop of implementation of CBS- regarding

To view SB order 2/2014, please CLICK HERE. 

Indiapost Started Internet Banking.

India Post started Internet Banking in selected locations in continuation of migration to the CBS FINACLE, Core Banking Solution from Infosys.  In Tamil Nadu Circle Greams Road Post Office of Chennai City Central Division has been rolled out for CBS on 16.12.2013 for the first time and all other identified offices in pilot Circles will be migrated in coming days. The India Post Internet banking site can be accessed through URL   https://ebanking.indiapost.gov.in/

India Post pushes ahead with banking plan despite opposition

India Post needs the government’s permission for the Rs.500 crore that is needed to set up a bank if it gets a licence from RBI. Photo: Hindustan Times

Mumbai: Despite strong opposition from the finance ministry, the postal department plans to approach the Union cabinet next month seeking capital of up to Rs.1,900 crore for a proposed commercial bank, according to two people familiar with the development.

To be called Post Bank of India, its branches will be linked to India Post’s vast network of post offices and will promote goals of financial inclusion, its supporters say.

“The department has decided to move the cabinet by October to seek the capital for Post Bank,” said a senior bureaucrat familiar with the proposal. The official requested anonymity, citing sensitivity of the matter. The second person, a consultant, also declined to be identified.

An email sent to financial services secretary Rajiv Takru on Tuesday remained unanswered at the time of writing this story.

India Post needs the government’s permission for the Rs.500 crore capital that is needed to set up the bank if it gets a licence from the Reserve Bank of India (RBI). While many government departments support the plan, some—mainly the department of financial services—have raised serious reservations, the official quoted earlier said.

India Post estimates an immediate requirement of Rs.700 crore and an additional Rs.1,200 crore in the first five years of its operations.

The move comes as the government prepares to launch a new bank exclusively for women with a capital base of Rs.1,000 crore.

The postal department, one of 26 contenders for banking licences, decided to rush with the proposal to the cabinet because it needs to convince RBI that it has enough funds if indeed Post Bank is shortlisted, the official said.

Global consultancy firm Ernst and Young LLP (EY) has drafted the blueprint for the proposed bank.

RBI governor Raghuram Rajan wants new banking licences to be issued by January-end, before deputy governor Anand Sinha, who has been spearheading the licensing process, retires. RBI is currently scrutinizing the applications and is also in the process of setting up a high-profile panel, to be headed by former RBI governor Bimal Jalan, to screen them.

Contenders for the new banking licences include L&T Finance Holdings Ltd, Aditya Birla Financial Services Group, Mahindra and Mahindra Financial Services Ltd, LIC Housing Finance Ltd, Tata Capital Ltd, IDFC Ltd, Reliance Capital Ltd and Bajaj Finserv Ltd.

In August, the expenditure department of the finance ministry had rerouted an earlier draft cabinet note from India Post seeking Rs.1,900 crore for the banking entry to another wing of the ministry. It asked the postal department to first seek the approval of the expenditure finance committee.

The expenditure finance committee, headed by the expenditure secretary, normally scrutinizes proposals for amounts of more than Rs.300 crore and for the creation of new autonomous organizations, regardless of the amount.

Within the finance ministry, the department of financial services opposes the move, saying the postal department does not have the expertise to run a bank, including handling credit and other banking functions. It feels the business proposal is unlikely to be viable.

But the postal department does not agree with this view, saying it has several years’ experience in deposit mobilization and that Post Bank of India will be run by professional management using its strong network. The postal department has close to 155,000 offices spread across the nation, as many as 139,040 of which are in rural areas.

Each rural post office covers around 6,000 people on an average, and urban post offices cover about 24,000 people each, according to a 2011 estimate.

As of 31 March, the outstanding balance under the Post Office Savings Scheme stood at Rs.6.05 trillion, equivalent of half the deposits of State Bank of India, the country’s largest commercial bank, and double that of the largest private lender ICICI Bank Ltd.

According to an interim report by EY in April, the proposed bank will focus on those at the bottom of the pyramid, or the poor, in non-metro centres, and avoid urban areas that are already well-served by existing banks.

People who already hold deposits with the Post Office Savings Scheme will have the option to transfer these to the proposed new bank, but this will not be compulsory, according to the official quoted earlier.

To begin with, Post Bank of India plans to open 300-400 branches, each also managing a specific number of postal outlets.

Post Bank

Department of Posts has proposed to set up a Post Bank of India. This will be an independent entity, separate from the current operations of Small savings Schemes being carried out by the Department on behalf of Ministry of Finance. The Department of Posts has accordingly submitted an application to the RBI on 28.06.2013 seeking a banking license subject to necessary Cabinet approvals.

The details of financial services offered by the Post offices at present are as below:-

(1)         Small Savings Schemes of Government of India (on behalf of Ministry of Finance)

(i)                 Post Office Savings Account

(ii)               Post Office Time Deposit Account

(iii)             Post Office Recurring Deposit Account

(iv)             Post Office Monthly Income Account

(v)               Senior Citizens Savings Scheme Account

(vi)             Public Provident Fund Account

(vii)           National Savings Certificates (VIII)  and (IX) issue

(2)   Money Remittances

(i)              Money Order-Domestic

(ii)            Instant Money Order- Domestic (through selected post offices)

(iii)          Western Union Money Remittances –International Inward (through selected post offices)

(iv)          MoneyGram Money Remittances –International Inward (through selected post offices)

(v)            Money Order Videsh- International Inward and Outward (through selected post offices)

(vi)          Electronic International Money Order Service-Inward (through selected post offices)

This information was given by Dr. Smt. Killi Kruparani, Minister of State for Communications and Information Technology in a written reply to a question in the Lok Sabha on 14/8/2013.

Supply of CTS-2010 Standard Cheque Books to POSB Customers

India Post applies for bank licence

    

With the Reserve Bank of India's deadline for applying for a bank licence fast approaching, the number of companies that have joined the list is rising. IndiaInfoline, Bajaj Finserv and the India Post are among the recent entities that have joined the ranks of licence seekers. 

"Bajaj Finserv Ltd has submitted its application to Reserve Bank of India on June 26, 2013 for a Licence to commence banking business in terms of section 22 of the Banking Companies Act, 1949. It is proposed to do this by converting its subsidiary Bajaj Finance Ltd into a Bank in terms of RBI Guidelines for Licensing of New Banks in the Private Sector dated February 22, 2013" the company said in a statement. 

Although the postal department has been expressing its ambitions to float a bank for long, RBI would have to create a special dispensation for India Post as it does not fit into several of the criteria prescribed by the central bank. Besides the prescribed norms, the postal department would face a huge challenge in putting in place a core banking solution that would facilitate a centralized view of all its accounts. However, there are many who feel that the postal department is ideally suited to spread RBI's objectives of financial inclusion. The department already mobilizes small investments through the Postal Saving Scheme and it has a network that is larger than any bank. 

Addendum to SB order No.09/2013 (Introduction of "Basic Savings Account" under Savings Account Rule 1981): Ministry of Finance (DEA) Gazette Notification No.323E dated 20.05.2013.

To view please Click Here.

Department of Posts to seek Cabinet nod for Rs 1,900 crore funds

Department of Posts has started inter-ministerial consultations for seeking Cabinet approval on around Rs 1,900 crore fund requirement to start Post Banks in the country. 

"DoP will need around Rs 1,900 crore to start Post Banks in the country. This includes Rs 500 crore paid-up capital required under new banking licence guidelines and rest is for other capital adequacy norms that Post Banks will need to fulfil. Cabinet note has gone to various ministries to seek their views," a government official told PTI. 

The Department of Posts (DoP) has plans to apply for banking licence to offer full-fledged banking services along with postal services through post offices. 

The RBI has issued comprehensive guidelines for new bank licences. It has fixed July 1 as the last date for filing application by interested entities. 

The DoP has proposed to start 50 bank branches in the first year and scale it to a total of 150 branched in 5 years. 

There are around 90,000 bank branches in the country and provision of real-time banking services through postal network is estimated to triple the current banking network. 

Finance Minister P Chidambaram in this year's Budget speech said Post offices will become part of the core banking solution ( CBS) and offer real time banking services. He proposed provision of Rs 532 crore for the project in 2013-14. 

The Post Banks are proposed to be owned by DoP but with a completely independent board, governance structure and operations. It will have representation from Ministries of Finance and Communication & IT. 

India Post set to open first ATM in Bangalore

BANGALORE, INDIA: When you hear 'ATM', what is the first thing that you relate to it? I am sure, many of us, including me, relate it to savings bank ATM card.
 

How about an ATM card similar to a debit card/ATM card issued by a bank for postal account? Sounds different right?

 

Yes, the Department of Posts, in an effort to provide enhanced solutions to its customers is all set to launch the first Automated teller Machine (ATM) in Bangalore GPO premises shortly, through a core banking solution.

 

Last year, the department of post had announced that it has plans to set up 1,000 ATM centres at different post offices across the country, with an aim provide better customer service through IT enablement of business processes and support functions.

 

Implementing new banking solution enables postal department to offer all kinds of services that are offered by private banks to more than 200 million post office saving bank (POSB) account holders in 1.55 lakh post offices.

 

When CIOL enquired about the launch of India's first India Post ATM, an official concerned with the Bangalore post office said, on condition of anonymity, that the ATM facility will be launch shortly with good features.

 

He further added that the postal ATM card enables POSB account holders to withdraw money from any bank ATM, provided they have enough savings.

 

"POSB account holder need not rely only on Post Office ATMs," he added.

Recently, TCS announced that it had bagged a Rs 1,100 crore, six-year contract from the Department of Posts to provide end-to-end IT modernisation program to equip India Post with modern technologies and systems to enable it to serve more services to more customers, in an effective manner.

 

Finance ministry opposes India Post’s banking licence plan

Mumbai: The finance ministry has opposed India Post’s plan to seek a commercial banking licence from the Reserve Bank of India (RBI) on grounds that the postal service doesn’t have the expertise needed in relevant areas, such as handling credit.

 

India Post is keen to set up a commercial bank called the Post Bank of India, arguing that it can significantly boost financial inclusion in Asia’s third largest economy through its nationwide network of 155,000 post offices.

 

This will also allow the organization, which posted a loss of Rs.6,346 crore in fiscal 2012, to make up for business dropping off over the years as letter writing dwindled and private courier firms took away market share.

 

Losses have significantly increased in recent years on account of higher expenses.

 

However, the finance ministry’s department of financial services doubts India Post’s ability to set up and run a bank, according to a senior postal department official who didn’t want to be named.

 

Some of the country’s large public sector banks have also been lobbying against the proposal, concerned that India Post, with its vast branch network, could pose a threat to their business, said the official, who’s directly involved with the proposal.

 

“The larger idea of setting up a bank is to further the cause of financial inclusion. Entry of India Post into banking can significantly help address this situation,” the official said.

 

However, “They (finance ministry officials) are asking too many questions. Why (do) you need a bank? What is your expertise to run a bank?” the official said.

India Post is engaged in several related functions, such as running a savings bank scheme, selling tax-saving instruments and accepting public provident fund deposits. The government also uses post office accounts to route payments to beneficiaries as part of the rural jobs programme and the direct transfer of subsidies.

 

A former government official said the postal department should focus on its existing business.

 

“It is totally illogical for the postal department to enter into banking. They do not have the experience in handling credit or the ability to manage a bank,” said D.K. Mittal, who was finance secretary till recently.