In the 2022 budget, Finance Minister Nirmala Sitharaman announced that around 1.5 lakh of post offices would come under the central banking system. This move will allow thousands of customers to access postal agency accounts via net banking, mobile banking and ATMs. “In 2022, 100% of the 1.5 lakh post offices will be integrated into the core banking system enabling financial inclusion and access to accounts through online banking, mobile ATMs and also online fund transfer. line between post office accounts and bank accounts,” Sitharaman said during the 2022 budget.
At present, post offices provide savings account services and payment banking services through the India Post Payments Bank. Connecting the postal network to the banking network will enable the online transfer of funds between post office accounts and bank accounts.
“The introduction of 75 digital banking systems in 75 districts by regular commercial banks will digitally empower people in a consumer-friendly way, supporting interoperability and financial inclusion. experience digital banking for the first time at their convenience,” said Anushman Panwar, co-founder of Creditas Solution.
If you have accounts at post offices, you will soon have online banking, mobile banking and ATMs. You will also need to transfer funds from one postal account to another postal bank account and bank accounts. This decision is in line with the mission of the central government to establish financial inclusion in the country.
“The term financial inclusion aims to help people secure financial services and products at economical prices such as deposits, remittance services, loans, insurance, payment services, etc. as Pradhan Mantri Jan Dhan Yojana, Atal Pension Yojana, Pradhan Mantri Vaya Vandana Yojana, etc. by integrating post offices into the main banking system”, Maneet Pal Singh, Partner, IP Pasricha & Co
“The integration of post offices into the banking system is an inclusive step that will bring the mass population from the remote parts of the country into the banking system in an organized manner. This will help integrate the services offered by post offices nationwide and enable the poor to access banking services, which will ultimately lead to the digital expansion of financial services,” said Manish Mishra, Partner, JSA
What this means for banks
This decision to integrate post offices into the central banking system will also pave the way for new digital banking models. This transition will also help big lenders like State Bank of India, HDFC Bank and Axis Bank to operate a large number of accounts and customers in the rural area. Low-cost financiers and SME lenders will also be able to benefit from interoperability and financial inclusion, experts say.
How this decision will help the government
This decision will allow the government to better monitor transactions and will result in effective dissemination of social protection schemes. “A digitized debt collection approach can help drive financial inclusiveness by providing smart personalized experiences with options to resolve debts on their terms,” Panwar added.
The 2022 budget also proposed to set up 75 Digital Banking Units (DBUs) in 75 districts nationwide by scheduled commercial banks. economical and user-friendly,” added the Minister of Finance.
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