The Department of Post plans to set up 1000 ATMs at post offices and convert them into banks for taking core banking to unbanked population using the vast postal network.
Replying to supplementaries during Question Hour in Rajya Sabha, Telecom Minister Kapil Sibal said there are 154,688 post offices in the country, the largest postal network in the world.
Of these 25,154 are departmental post offices and the rest Gramin Dak Sewak (GDS) managed post offices which are predominantly in the rural areas.
These post offices, he said, can double up as banks once they are computerised.
24,969 departmental post offices have been computerised as on March 31, out of which 19,890 have been provided with network connectivity. The GDS managed post offices will be computerised under a comprehensive IT project for which an outlay of Rs 1,877.2 crore has been made, he said.
"Introduction of core banking in networked post offices and setting up of 1,000 ATMs is also part of this project," he said.
An application for converting post offices into banks has been made to the Reserve Bank of India (RBI). Once implemented, coverage of the banking network in the country will increase three-fold in one go, he said.
Sibal said financial services at post office will cost a fraction of the cost of setting up a bank branch.
Besides, post offices could also double up as retail intermediaries, buying rural products, besides being delivery vehicle for schemes like Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).
"This is what we need to be doing. I hope we have resources," he said.