Proposal on postal bank awaits PM's nod

The Posts and Telecommunications Division has sought approval from the prime minister to open a postal bank in order to take basic banking services to the remote areas of the country.

If the government goes ahead with the proposal already sent to the premier, the postal department will become the country's largest bank with 9,866 offices across Bangladesh.

The postal department has set out a plan to restructure its service and targeted banking and e-commerce to generate revenues, said Tarana Halim, state minister for the Posts and Telecommunications Division, last week.

"Post offices can ensure the government's presence in the remotest part of the country. They will also be able to provide digital services as traditional postal services are going to be obsolete gradually," she said.

A few months ago the telecom division sought approval from the finance ministry to roll out the services under Bangladesh Post Office.

"The ministry raised some queries and we have responded to them. In the meantime we have sought the prime minister's approval to speed up the process," Tarana added.

Senior officials of the division said they are interested to set up a bank like Shimanto Bank, owned by Border Guard Bangladesh, which is a services bank but offers commercial products.

Tarana said the banking services can give a boost to the postal department financially, help the government's social safety net programmes and make savings instruments popular especially in the rural areas.

"We think there is a scope to serve the people living in the remote areas through the post offices."

The telecom division has also applied to the Bank and Financial Institutions Division. If the approval process delays for a lengthy period the division will try to explore agent banking service under a commercial bank.

The paid-up capital that will be needed to roll out the banking services has not been finalised yet.

The postal department had been a losing concern for a long time but Tarana said things have changed in recent years.

It clocked about Tk 6 crore in profit in 2015-16 after turning over Tk 294.05 crore as revenues, up 16.52 percent year-on-year.

In the first six months of the current fiscal year, the department's income stood at Tk 129 crore, a growth of 41.75 percent over the same period a year ago, said Susanta Kumar Mandal, director-general of the department.

"We are preparing ourselves for introducing financial services. We already provide some sort of financial services," he added.

Post Offices offer savings instruments that carry interest rate of more than 10 percent, a rate no banks offer at the moment.

The post offices also provide financial services such as life insurance, electronic money transfers, ATM services under postal cash cards, money orders and postal orders.