Unconfirmed reports indicate that the union finance ministry opposes the proposal of India Port to foray into banking venture.
Officials of the finance ministry raised doubt about the ability of India Post to conduct banking business. It may be recalled that India Post plans to apply for a banking license from Reserve Bank of India (RBI).
In February 2013, RBI invited applications from private and public sector entities to set up banks in order to promote financial inclusion.
India Post claims that it could promote financial inclusion through its nationwide network of 155,000 post offices.
However, the finance ministryÂ’s department of financial services reportedly doubts India PostÂ’s ability to set up and run a bank.
Some of the countryÂ’s large public sector banks have also been lobbying against India Post’s plan as they are concerned that the postal undertaking, with its vast branch network, could pose a threat to their business.
India Post is engaged in several related functions, such as running a savings bank scheme, selling tax-saving instruments and accepting public provident fund deposits.
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