Cabinet clears India Post's payments bank proposal

The government on Tuesday cleared the proposal to set up India Post payments bank, which will start operations with an initial corpus of Rs800 crore and 650 branches by September 2017, telecom minister Ravi Shankar Prasad said today.

''The cabinet has cleared proposal of postal payments bank. We have 1.54 lakh post offices of which 1.39 lakh are rural post offices. 650 branches of postal payments bank will be established in the country which will be linked to rural post offices,'' Prasad said.

The minister said the payments bank will be professionally managed and will be run by a chief executive officer. Besides the Department of Posts there will be a representation from various other government departments including Department of Expenditure, Department of Economic Services etc, he added.

''Total architecture of postal payments bank is of Rs 800 crore which will have Rs 400 crore equity and Rs 400 crore grant. By September 2017, all 650 branches of postal payments bank will become operational. This we had planned for three years but now we will be doing it in a year,'' Prasad said.

He said that all 'grameen dak sevaks' in rural post offices will be given handheld devices by March 2017.

''We are reinforcing it further. I have had discussion with my officers to give iPad and smartphones to postmen in urban post offices,'' Prasad said.

At present, core banking network of post offices is more than that of State Bank of India. SBI has 1,666 core banking branches while 22,137 post offices now have core banking facility.

Earlier, last week, the union cabinet chaired by the Prime Minister Narendra Modi granted ex-post facto approval to the proposal for undertaking cadre review of the Indian Postal Service.

The cadre review will enable the Department of Posts to meet the functional requirements and strengthening the cadre structure both in the headquarters and in the field on the basis of functional requirement, which will provide more avenues to earn review and respond effectively to the customer needs, reduce the existing stagnation and improve the career prospects of Indian Postal Service officers.

The proposal will be implemented through measures that include creation of a post of DG (Postal Operations) in the Apex scale, creation of post of Additional DG (Coordination) in the HAG+ scale, one post in HAG level, 5 posts in SAG level and 4 posts at the JAG level, and also increase of 84 posts at JTS level by down-grading from STS and overall decreasing STS posts by 96 for adjustment of new posts proposed to be created, without any overall change in the total number of posts in the cadre.