By Ruma Dubey

As time changes, one has to evolve with time, or else there is the fear of either being reduced to just a miniscule existence or getting completely wiped off existence. And it is good to know that India Post is awake to this reality.

After the advent of the courier services and internet, Indian postal services have been literally reduced to a fight for survival. When was the last time you visited your roadside post office? More importantly, when was the last time you either received a letter by post or sent a letter? Are you aware of the new stamps which have been released by Indian Post? Letters have become ‘souvenirs’ which one preserves, a rarity. The picture of the postman walking wearily from building to building, wearily trudging with a bag on his shoulders has become a thing of the past. And it is good that the Indian Post is aware of these realities and is making attempts to evolve with time.

Today, a visit to the post office could be for either putting money in your monthly postal savings scheme or transact such similar activities. From a postal services organization, it is today a semi-bank. The Communications Minister, Mr. Kapil Sibal, wants the Reserve Bank of India (RBI) to grant a banking license to India Post. Why not? This idea has been around for ages yet it does not seem to take off. The Indian post, in terms of its reach is formidable - there are 1.55 lakh post offices in the country, of which 1.39 lakh are in rural areas. It has 75,000 branches which is more than all scheduled commercial banks put together. The various savings schemes operated by post office across India have outstanding balances of some Rs 600,000 crore. 

The idea is perfect and it is not something which is not doable. Japan, one of the most developed countries of the world is already doing this. Most post offices in Japan offer a savings account and it does cover most banking needs including ATMs at a wide range of places including remote villages and mountain towns. Japan Post secures 28% of Japan's household savings and is widely billed as the world's largest bank.

India Post is already doing many activities of a bank and giving it that stature will not only help it over its losses but might also give a new meaning to micro financing.  As per a report in the Hindu, this decision to include India Post has already been proven in the context of implementation of the Mahatma Gandhi National Rural Employment Guarantee Scheme, where 46.7 million accounts had been opened and wages amounting to over Rs 18,000 crore had been distributed as on October 31 last year. It is also proving useful as the nodal agency for distribution of UIDAI cards.

The only bee in this bonnet could be the lack of adequate staff who would be capable enough to handle banking activities. But then again, it is a huge employment opportunity and if given the right training and if proper infrastructure is put in place, it could become as a big a revolution as the mobile phones in India.

India Post becoming a bank could mean it could become larger than SBI, at least in terms of reach. And if nurtured well, it could indeed become humungous. Once it turns around, it could even think of divesting stake!

Yes, India Post could become a mulch cow from the current emancipated bone dry cattle it is. The potential is very much there but like all things in India, it only needs to be implemented right. This can become a great “political” move which the UPA can ride on. Will it have the sense to cash-in or will it just bleed the country and the other profit making PSU organisations to death?