POSB now the country's oldest and largest savings bank

My article "POSB now the country's oldest and largest savings bank" published in today's (05.01.2021) English National Daily "The Pioneer"
 
Tuesday, 05 January 2021 | BRUHASPATI SAMAL
 
The Department of Posts (DOP) introduced Post Office Savings Bank (POSB) on April 1, 1882. But the foundations of the Government Savings Bank were laid in the year 1833 when the first bank was opened in Calcutta (Kolkata) for investment of the savings of all classes – British and native. Two more branches were opened at Bombay (Mumbai) and Madras (Chennai) in 1833 and 1834 with maximum deposit limit of Rs 500 at 4 per cent interest.
 
With an intention of extension of the scheme, establishment of District Savings Banks (DSB) was announced on May 16, 1870. But consequent upon introduction of POSB in 1882, the Government of India in their Resolution No. 33, dated 04.01.1886 ordered for amalgamation of DSB and POSB.
 
As a result of the merger, 31,699 accounts representing Rs 1,24,13,792 were transferred from DSB to POSB. With the addition of this, at the end of 1886-87, the number of POSB accounts stood at 2,19,010 with balance of Rs 4,255 lakh.The local Government Savings Bank at Kolkata, Mumbai and Chennai and Presidency Banks merged with POSB on October 1, 1896.Subsequent history has been one of the continued prosperity barring temporary setbacks during the war periods. And now, the POSB having transaction in all 1,56,600 Post Offices is now the biggest and the oldest Savings Bank organization in the country and still owns the people’s faith because of the safety and security of the investment of the public. As on October 2020, the POSB has 35.66 crore accounts and 13.92 crore certificates.
 
In order to promote canvassing of savings of the people, the Government of India introduced various agency systems and introduced various schemes in addition to Savings Bank General Account to suit the needs of the common man viz., Time Deposit (TD) Account (1 Year, 2 Year, 3 Year and 5 Year), Recurring Deposit (RD) Account, Public Provident Fund (PPF) Account, Monthly Income Scheme (MIS) Account, Senior Citizen Savings Scheme (SCSS) Account and Sukanya Samridhi Account (SSA).
Easy and acceptable methods of opening of account, subsequent deposit, withdrawal, closure, transfer and above all the satisfactory rates of interest in comparison to banks and other financial institutions have attracted the members of public towards POSB schemes. While there is no upper limit of investment in case of SB, TD and RD Account, the upper limit of investment against MIS account is Rs 4.5 lakh for single and Rs 9 lakh for joint account.

 
Similarly, the maximum investment that can be done in SCSS account is Rs 15 lakh. For PPF and SSA, the limitation is Rs 1.5 lakh per year. Moreover, investment in SSA, SCSS, PPF and 5 Year TD qualifies for the benefit of Section 80C of the Income Tax Act, 1961.The interest earned in SSA is tax free under Income Tax Act.
 
Through Government Savings Certificate Act, 1959, DOP also introduced various Certificates, viz., National Savings Certificates (NSC), National Plan Certificates, National Defence Certificates, National Development Bonds, Social Security Certificates, Indira Vikash Patra (IVP), Kisan Vikash Patra (KVP). The above certificates have been discontinued except NSC VIII issue and KVP. While investment against KVP is doubled in 124 months, investors can claim IT exemption under 80C against investment under NSC.
 
For providing Any-where, Any-time and Any-branch banking, Core Banking Solutions (CBS) was included in the 11th Five Year Plan for development of CBS software and other related activities and in the meantime, India Post has successfully implemented Core Banking Solution under IT Modernization Project, 2012 in all its 25,487 Departmental Post Offices.
 
Banking solution through mobile application and hand-held devices are also provided to the 1,31,113 Gramin Dak Sewak Post Offices. To be more citizen-centric, India Post accelerated its movements clearly focusing on prompt and effective service delivery with minimum inconvenience to the citizens adding more products and services.
 
As a result, India Post Payments Bank Limited (IPPB) came into existence with effect from September 1, 2018 in 650 branches and 3,250 access points with the objective to build the most accessible, affordable and trusted bank for the common man, to spearhead the financial inclusion agenda by removing the barriers for the unbanked and to reduce the opportunity cost for the under banked populace through assisted door step banking with a rich slogan “AAPKA BANK AAPKE DWAR”. 
 
Providing the facilities of ATM, Internet Banking (w.e.f. 14.12.2018) and Mobile Banking (w.e.f. 15.10.2019) to the POSB customers, it is winning the trust of 130 crore Indians. The daily banking transactions and daily ATM transactions come around 51.22 lakh and 1.25 lakh.
 
(The writer is chairman, National Federation of Postal Employees)
 

 

BRUHASPATI SAMAL, Circle Secy, AIPEU,Gr-C, Odisha

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