The main function of the post office of delivering letters has reached the decline stage of this service’s lifecycle. Thus, instead of turning this institution into redundancy, a new service trajectory has been added to the functions of the post office, which is availing full-fledged digital banking service from May. This will benefit about 34-crore post office savings account, holders. The government has approved linking such accounts with that of India Post Payments Bank (IPPB).
“The finance ministry has approved linking of savings bank accounts at post offices with IPPB accounts. This will enable post office account holders to transfer money from their account to any bank accounts…,” an official source revealed.
The 34 crore savings accounts consist of 17 crore post office savings bank accounts, while the remaining are the ones that subscribe recurring deposits, monthly income scheme etc.
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The move has also paved the way to create the largest banking network in the country. This will be made possible as India Post has plans to link all 1.55 lakh post office branches with the IPPB. The core banking service has been started by India Post but offers money transfer service within Post Office Savings Bank (POSB) accounts.
“IPPB is governed by Reserve Bank of India and banking service of post offices comes under the finance ministry. IPPB customers can use NEFT, RTGS and other money transfer services as available for any banking customers. Once POSB accounts are linked with IPPB, customers will be able to enjoy all money transfer service like other banks,” the source further revealed.
He said that by May, India Post will give the option to POSB account customers to avail this facility.
“The service will be optional. If post office account holders opt for it, their account will be linked to their IPPB account,” the source said.
“In the second phase, starting September, account holders in post office will have an option to pay for post office products from their IPPB accounts including deposit money for Sukanya Samridhi Yojana, recurring deposits, speed post, etc,” he said.
Thus, Modi’s dream project of opening bank account for all is being made easier by this conversion of the post office to fully fledged banks. This will help the people in the backward regions of India so long the post office, like most nationalized banks, do not impose unknown and unreasonable charges to the hard earned savings of the poor.