Hitachi may partner with Dept of Posts for payments bank

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Ravi Shankar PrasadJapanese firm Hitachi is interested in partnering with the Department of Posts for payments bank solutions, according to Union Communications & IT Minister Ravi Shankar Prasad.

After a meeting with Hitachi President & CEO (IT Systems) Yutaka Saito, who called on the minister on December 16 and discussed about the possibility of Hitachi offering its banking solutions to the Department of Posts, Prasad made the disclosure.

The minister said that he has asked them to make elaborate presentations on how they propose to go about it. “They have come up with the idea of revenue sharing model to install the banking solutions in all the post offices in India. We will consider it,” he said adding that he has also asked the Department of Posts to work out the details.

Hitachi Ltd has been offering banking solutions related to ATM, point of sale (POS), cash and deposit machines, and card management solutions to almost all leading banks of the country.

The minister also underlined the need for technical upgradation of rural post offices to make payments bank idea a success.

“I have assured them that with Digital India opening up in India in a big way, there is enough scope for products, marketing, consumer base and innovation,” he added.

The Reserve Bank of India earlier this year granted approval to 11 applicants, including the Department of Posts, to set up payments banks.

As per RBI guidelines, payments banks would offer a limited range of products, such as demand deposits and remittances. They will not be allowed to undertake lending activities and will initially be restricted to holding a maximum balance of Rs 1 lakh per individual customer. Although they will be allowed to issue ATM or debit cards and other prepaid payment instruments, but not credit cards.

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