Once the unwanted baggage, India Post now has over 60 giants vying for partnership post payments bank licenseNew Delhi: Five dozen companies have lined up to partner with India Post, pegged as the unwanted baggage not too long ago. Biggies in the financial sector wishing to partner with the postal department
New Delhi: Five dozen companies have lined up to partner with India Post, pegged as the unwanted baggage not too long ago.
Biggies in the financial sector wishing to partner with the postal department include the likes of Barclays, Citibank, Western Union, Deutsche Bank, State Bank of India and Punjab National Bank. The World Bank group too has shown interest. HDFC Life, ICICI Prudential, ICICI Lombard, Kotak Life Insurance, Bajaj Allianz, Royal Sundaram and PNB Metlife are in the line for an alliance in the insurance business.
Transfort and Western Union from the US want to deal on money transfers; BNSL wants a partnership for the mobile wallet business, while American financial services have approached India Post for a pact on ATM and point-of-sale transactions. Virtually everybody is looking to partner with India Post.
The reason behind the marked change in sentiment is on account of the payments bank license that it received from the RBI last year. “With India Post having got a payments bank licence, there is a scramble to forge partnerships and alliances," IT minister Ravi Shankar Prasad, in charge of the Department of Posts, was quoted as saying.
India Post’s unmatched reach across the length and breadth of the country also makes it a good catch for companies looking to make inroads into India’s hinterland. There are almost 1.5 lakh post offices across the country, in which 1.3 lakh covers the rural India. Core banking solutions and ATMs has attracted for financial opportunities in banking, MFs, insurance and money transfer.
India Post has already succeeded in tying up with over 800 e-commerce companies, which includes Flipkart, Snapdeal and Amazon. Also Parcel revenue, which registered a dip of 2 per cent in 2013-14, grew 45 per cent in 2014-15 and has a strategy of 100 per cent till February in 2015-16. These aspects have grown the interest of partnerships with the postal department.
The postal department in August got the licence for payments bank from the Reserve Bank of India. Also the central bank has allowed 10 other firms and tech companies to operate payment banks. Payments banks can accept deposits up to Rs 1 lakh.