Sunday, March 24, 2013

India Post to seek licence for all-women’s bank

Dear Comrades,

NEW DELHI: The postal department, which is keen on setting up a branch, is making a pitch to the finance ministry to establish the proposed women's bank announced in the budget.

The bank, probably the first of its kind in the world, will lend mainly to women and women-run businesses, and will predominantly employ women. Sources said that the suggestion is being made at the ministerial level although the finance ministry has tasked a committee to prepare a blueprint of sorts.

While department of posts secretary Padmini Gopinath underlined her department's credentials saying that country's first all-women's post office had just been launched and a second one in Delhi University is almost ready, she did not specifically comment on offering to set up the proposed bank. 

Gopinath, however, told TOI that the department of posts was keen on getting the Union Cabinet to endorse the plan and would prefer to seek a licence to set up a bank after receiving legislative backing to the proposal. "We would like to have legal backing, like the other public sector banks," she said at the National Editors' Conference here on Saturday.

Public sector banks are backed by the bank nationalization laws of 1970 and 1980, while State Bank of India ( SBI) and its associate banks have been set up under separate legislations.

Just last month, RBI issued final guidelines for issuing licences to "new banks in the private sector". While Gopinath said that the department was exploring the option of approaching RBI for a licence, meeting the deadline July 1 deadline may be difficult as Ernst & Young, the consultant for the banking project, is expected to submit its report around June.

Apart from suggesting a structure, the consultant is also doing a survey to ascertain the post offices that may double up as "agents" for the bank to collect and deposit funds, especially in rural areas. "We have to decide if we want to be in cities and use post offices as agents or whether we should have branches in smaller places," she adding.

As reported by TOI on March 14, the department of posts will set up a separate entity for its banking foray to tap into its network spanning around 1.55 lakh post offices. Asked about concerns that the proposed bank may pose a threat to some of the largest players as well, Gopinath said, "Threat is not an issue. The question is whether you have the reach or not. We are present in villages across India and we can help banking reach to the farthest corners of the country."
Related Posts Plugin for WordPress, Blogger...
Related Posts Plugin for WordPress, Blogger...
Related Posts Plugin for WordPress, Blogger...