Union cabinet lead by Prime Minister Narendra Modi approved postal payment banking services on Wednesday. As per the approval, government will start banking services in rural and semi urban area by establishing 650 payment banks by 2017 September.
“We wanted three years time to complete this… But, PM has asked us to complete the project in one year. So by September 2017 we will bring all these payment banks to operational mode,” said Telecom Minister Ravi Shankar Prasad.
People in rural areas will be able to avail banking services and Direct Benefit Transfer via payment bank network of these 650 payment banks become operational.
As per available data India has 1, 54,000 post offices, of these 1.39 lakhs post offices are located in rural areas. Government proposed payment banks will link these rural branches with help of Postmen carrying moving ATM’s.
“The network is bigger than state bank. Post integration, this network of branches will become world’s largest banking network,” said the Telecom Minister.
Government is exploring options to give technology training postmen, who will serve delivery agents of people using postal payments bank.
“Reinforcing post man via payment bank is our goal. We will provide moving ATM’s to 1. 7 lakh postmen,” said the Minister.
As per the cabinet statement, government will use 5000 movable ATM’s to collection of taxes, remittances and other third party services.
“It will be a game changer in rural and semi urban. We will include wallet and other modern services of financial transaction,” said Ravi Shankar Prasad.
The payment Bank network will have a Chief Executive Officer and it will be managed by professionals who will work under an independent authority. Government is estimating an Rs 800 crores of which 400 will be equity and Rs 400 crore grant.