The initiative of India Post
to connect Post Offices through Core Banking Solution will shake the banking
industry shortly. Even though Post offices are doing Small saving
activities as an agent of Ministry of Finance, they have the potential in terms
of deposit backings, wide network across the country and strong employee
support to shake the industry.
Post Office Savings Bank
(POSB) which is called as Poor’s Bank has the major share of Deposits in India
compared to any other banks. Since India Post is a government Institution
working without profit motive, getting the exact figures of deposits and number
of account was difficult compared to full-fledged banks with corporate
entity. So till now the actual figure were unknown to everyone.
Now the scenario has been
changed when Post Offices started getting migrated to Core Banking
Solution. When a Post Office gets migrated, the exact figures of number
of accounts and total deposit amount will be generated. Through this
figures everyone can see the strength of Post Office Saving Bank in India.
India Post successfully
migrated its first office to Core Banking in December 2013. Like any others big
public sector and private sector banks, India Post is using Finacle, the
leading Core Banking Solution from Infosys for their banking renovation.
Now India Post is near to reach its first milestone of 1000 CBS Post Offices in
India and expecting this by December 2014. Till 27.11.2014 total of 961
Post offices have been migrated to CBS platform.
India Post is planning to
include 25000 plus Post Offices in Core Banking network with in few years.
By this mission all the departmental Post Offices will come under this
CBS category Post Offices. Now itself all these offices are computerised
and they are doing banking transactions using Sanchay Post software. Even if we
take number as 25000, the figure is not at all a small one when compared to
other big nationalised banks.
As per the Annual Report
2013-14 State Bank of India has only 16069 branches including 15869 domestic
branches and 190 foreign branches. If we include the branches of Associate
banks too, a count of about 5700 more branches will be added to this
list. Even after adding the associate banks to this list SBI have only
21769 branches across the world. The second largest public sector bank is
Punjab National Bank. They are following far behind with only 6206
branches (6201 domestic branches and 5 foreign branches)
If we take the amount of
deposit as criteria, India Post will again be the number one in the
industry. Only 961 Post Offices have been migrated to Core Banking till
27.11.2014, but the value of deposits in these migrated offices crossed Rs.
87204 Crores. Total of5.51 Crores account have been
migrated to this new platform. This is from only nearly4% of
total Post Offices to be migrated to Core Banking. If we take the
proportionate figure, deposits will surely cross 20 Lakh Cores rupees after
migration of all computerised Post Offices. State Bank of India have only
deposit of rupees 13.94 Lakh Crores as per annual report 2013-14. Number
of branches and total deposit value of major nationalised banks are shown below
for comparative analysis.
|
SL NO
|
Name of Banks
|
No. of CBS branches
(as on 31.03.2014)
|
Total Deposit
( in Crores)
|
|
1
|
India Post (POSB)
|
*25000
|
*22,68,574
|
|
2
|
State Bank of India
|
16069
|
13,94,409
|
|
3
|
Punjab National Bank
|
6206
|
4,51,397
|
|
4
|
Bank of Baroda
|
5062
|
5,68,894
|
|
5
|
Canara Bank
|
4755
|
4,20,723
|
|
6
|
Bank of India
|
4671
|
4,78,695
|
|
7
|
Central Bank of India
|
4336
|
2,40,069
|
|
8
|
Syndicate Bank
|
3251
|
2,12,343
|
* Expected numbers after
migration
Commercial banks are
attracting customers by giving value added services like ATM, Debit/Credit
cards, Internet Banking, mobile banking, etc. Now most of the people are
depending banks for such needs. In order to compete with commercial banks or
for attracting new customers or giving more value to their account holders,
India Post started various value added services like Internet Banking, ATM,
etc. Now the ATM facility is introduced in limited areas but the Department of
Post is planning to install 2800 ATMs by the end of 2015.
By the end of 2015 CBS network
of India Post may be connected to other banking networks and thereby a Post
Office customer can make use of all the facilities (except loans) now a
commercial bank customer can enjoy. If the value added services of India
Post is a success, surely it will lose the customers of commercial banks. And
in such circumstances people in the rural areas will not approach Banks,
normally located in urban or semi-urban areas for transacting in SB accounts.
Now Savings Bank account in Post Office are not attractive only because of lack
of availability of value added services like ATM, Debit cards, net
banking,etc. Now Department of Post is taking all efforts to fill this
gap occurred in the past.
Finally expecting that today’s
technological renovation of India Post will surely shake Indian Banking
industry in near future in various ways. Let us wait and see.
Source:- www.postbankofindia.org
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