1.5 Lakh Post Offices Will Be Linked With Core Banking Network: ATMs, Branches & More!
There’s good news for post office bank customers- the government will bring the entire post office network under core banking system or CBS this year.
1.5 Lakh POs Covered
This will ensure easier transfer of funds and interoperability with the banking network.
Currently, post offices provide savings account services and payments bank services through the India Post Payments Bank.
Finance Minister Nirmala Sitharaman said that 100% of 1.5 lakh post offices will join the CBS.
This will enable financial inclusion and access to accounts through net banking, mobile banking, ATMs.
Size And Scope Of The Network
India Post serves more than 50 crore post office savings bank customers through 1.5 lakh post offices across the country.
More than 35 crore post office deposit accounts with deposits amounting to more than ?10 trillion will now be connected to CBS.
The move to bring all of them under core banking will allow interoperability between bank and post office accounts.
For example, one can now transfer money online to their post office account and access these accounts through net banking.
Several post offices are currently offering these services but once all of them are on board, interoperability between post offices will increase significantly.
This integration will also give depositors access to bank infrastructure like ATMs
Customers will also be able to transfer funds between post office accounts and bank accounts online.
Reaching The Unserved And Underserved
This move will be especially beneficial to farmers and senior citizens in rural areas.
The government had started its mission, the National Mission for Financial Inclusion (NMFI), in August 2014 which would offer universal banking services for every unbanked household.
Financial inclusion is based on the principles of banking the unbanked, securing the unsecured, funding the unfunded and serving unserved and underserved areas.
Digital Banking Push
Sitharaman also proposed the opening of 75 digital banking units in 75 districts by scheduled commercial banks in order to increase digital inclusion.
It is beneficial for the banking sector as garnering liabilities and distribution of financial products becomes more viable along with ease of access to customers.
This announcement could serve as a boost for the country’s emerging Fintech start-up sector, which can take advantage of the benefits of digital banking in every part of the country.