Some of the post offices likely to be converted into India Post Payments Bank branches

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Some post offices may be converted into full branches of Postal Payments Bank of India with a view to increasing flexibility and giving a more modern look to post offices.

“There is a deliberate process to convert some post offices into full payments bank branches so that both payments bank and post office related business can be handled,” a source told Businessline.

Postal Payments Bank of India currently has one branch which has no customer interface. All customer services to the bank are only provided through post offices, which are technically bank outlets rather than branches.

“Post offices operate as a bank branch, but the only thing is that the operations are a little more detailed (because of the classification),” the source said, adding that the bank may have to obtain individual approvals for each transfer from this outlet. to branch.

According to the regulations, small finance banks, payments bank and local area banks need to obtain prior approval from the Department of Banking Regulations of the Reserve Bank of India (DBR) to open, close, transfer, merge and transfer bank outlets.

The idea is in a nascent stage and the bank is in the process of developing a business model, which is being discussed with the Financial Services Department.

banking outlets

Bank outlets are fixed service delivery units, manned by either bank employees or trade correspondents, that provide limited services such as accepting deposits, cashing checks, withdrawing cash or loans for at least 4 hours, at least five days a week.

Given this designation, post offices were not allowed to exchange RUB 2,000 notes as per the directive on withdrawing them at bank branches, issued by the Reserve Bank of India on Friday. However, because the coin is still legal tender, post offices still accept deposits.

Transferring to branches, will allow post offices to provide more value-added banking services and products, and meet the needs of more customers. In return, it will allow the bank to customize and develop these customer touch points to provide better services on the ground.

India has a network of 1.5 lakh post offices of which 1.4 lakh are in rural areas, according to the Ministry of Post website.