New Delhi, June 27: The department of posts today submitted an application before the RBI for a licence to offer full-fledged banking services.
“We have approached the RBI today and hopefully having met all the conditions of the RBI, an in-principle approval might be given. If it is given, I think, it will be a revolutionary step because it will bring banking, subject to cabinet approval, to the doorstep of the ordinary man in this country,” telecom and IT minister Kapil Sibal said.
The RBI has initiated the process of granting fresh bank licences and has set July 1 as the deadline for applications.
The Indian postal network has 1,54,822 post offices. Of these, 1,39,086 are in rural areas and 15,736 in urban regions.
There are around 90,000 bank branches in the country.
The postal department plans to start 50 bank branches in the first year and scale it up to 150 in five years.
Sibal said after the RBI’s in-principle approval, the department will require the cabinet go-ahead.
“The RBI should agree that this (banking licence for DoP) is the proposition that must move forward because most of the aam aadmi (common man) do not have access to banking facilities. Post Bank is an ideal way to bring banking to the doorstep of the aam aadmi,” Sibal said.
The DoP has started inter-ministerial consultations for securing cabinet approval for around Rs 1,900 crore to start Post Banks. The total amount includes Rs 500 crore paid-up capital required under the banking licence guidelines.
The Post Banks are proposed to be owned by the DoP but with an independent board, governance structure and operations. It will have representation from the ministries of finance and communication and IT.
Others in the fray
State-owned IFCI and financial services provider India Infoline today said their boards had given approval to apply to the RBI for licences.
Also, in a filing to the Bombay Stock Exchange, Bajaj Finserv said it had submitted its application on June 26 for a licence to commence banking operations. “It is proposed to do this by converting its subsidiary Bajaj Finance Ltd into a bank,” it said.
