India Post has gone live with its core banking platform in 200 post offices, piloting Infosys Finacle and a postal life insurance system based on Infosys McCamish platform.
This is the part of the end-to-end IT Modernization project 2012 programme by the Department of Posts to equip itself with modern tools and technologies.
Around 23,200 out of 155,000 post offices in India are to be migrated into the Core Banking Solution (CBS) by 2015.
Once all the post offices are live on the CBS, customers will be able to access their post office savings account anywhere in the country through multiple channels including internet browser, mobile and ATM.
C.N Raghupathi, head of Infosys’s India business, said there has been positive acceptance among end users with smooth implementation and adoption.
While the implementation is not affecting India Post staff, they do need some training on the usage and deployment of the new platform and solutions.
“There are two types of users for the software,” said Raghupathi. “One is the users from India Post and the second is the end users.” He said there are some pockets of resistance among users. “The resistance stems from the fact that this is a much more robust piece of software and has complexities which we are trying to work on through training. And for the India Post users, there is training that we have to do.”
“Also, most of the post offices are operated by people who are largely educated to only middle school level and who operate in some of the most remote areas of the country. Obviously, giving them a robust piece of software which is used by international banks and global insurance agencies requires a lot of training,” said Raghupathi.
India Post has post offices in 22 areas across India with one branch per 8,000 people for every 22 square kilometres. CBS, which went live in December, is already implemented in Delhi, Uttar Pradesh, Tamil Nadu, Karnataka, Maharashtra, Assam and Andhra Pradesh.
Additionally, the software for the ATM is ready and these ATMs have been installed in 100 post office banks. These ATMs will be replicated in 1,000 other locations across the country in the next few months and will be scaled up to 2,800 by 2,015.
“The next step is to roll it out to 2800 [Post Office] banks. We have to make sure this is done correctly and things work smoothly. This in itself will take the better part of the next one year,” said Raghupathi.
Raghupathi said that to enrich the mobile banking experience, the next stage would be to add mobility as a solution to take the banking system to people that can’t reach a bank. “That’s a different project in itself and the software for this is ready but India Post has to order the hardware, which is essentially handheld devices which will let the post man become a mobile banking correspondent.”
Source : http://searchcio.techtarget.in/news/2240220389/India-Post-banking-system-and-ATMs-goes-live-in-hundreds-of-post-offices
Finmin nixes India Post's plan to set up a bank
Tells RBI this is not the time to consider such a foray, especially given the lack of funds to spare for such a venture.
The Union finance ministry has poured cold water on India Post's application to set up a bank. The postal department might be asked to re-apply when new guidelines forbank licences are issued by the Reserve Bank of India (RBI).
As suggested by the Bimal Jalan-headed screening committee, the issue came up for discussion at a recent meeting of the finance ministry and RBI, a ministry official said. The ministry said India Post was not ready for a banking foray.
India Post had said it needed Rs 1,800 crore to set up the bank. The postal department had sought an initial capital of Rs 623 crore from the finance ministry. It had thought of raising the rest from other sources.
As suggested by the Bimal Jalan-headed screening committee, the issue came up for discussion at a recent meeting of the finance ministry and RBI, a ministry official said. The ministry said India Post was not ready for a banking foray.
India Post had said it needed Rs 1,800 crore to set up the bank. The postal department had sought an initial capital of Rs 623 crore from the finance ministry. It had thought of raising the rest from other sources.
| NO BANKING JOB FOR THE POSTMAN |
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"When we don't have enough money to recapitalise existing public sector banks, how can we afford to give funds for a new government bank?" said the official.
RBI had granted licences to only two entities, IDFC and Bandhan Financial Services, of the 25 applicants which applied to set up a bank.
The high-level advisory committee (Jalan panel) set up by RBI to look into the bank licence applications had recommended the central bank consider India Post's application separately, in consultation with the government, and RBI had agreed to do so.
RBI had also said that instead of only opening the licensing window periodically, it would like to make it a regular process, also mooting the idea of differentiated licences.
Officials said RBI might issue new guidelines with some modifications for on-tap and differentiated licences. Then, India Post could stand a chance, particularly as a deposit-taking bank, provided it addressed the concerns of all stakeholders, they added.
The advantage with India Post is that it has a branch in every nook and corner of the country. So, it can help the government reach the objective of financial inclusion.
"India Post deserves the licence because they have the ability to attract customers, the first step towards financial inclusion. It is easier to lend but difficult to get deposits," said Abizer Diwanji, partner and national leader-financial services, EY.
While India Post has deposits of Rs 4 lakh crore, it doesn't have experience in handling advances. It has a huge workforce but lacks experience in the range of banking operations, particularly treasury and risk management. Thus, it will have to get talent from the market, while some from its existing staff of 474,000 might be redundant.
India has the largest postal network in the world, with 155,015 post offices (against 98,000 bank branches), of which 90 per cent are in rural areas. However, the department posted a loss of Rs 5,805 crore in 2011-12. Both Bandhan and IDFC, on the other hand, are profitable.
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