ODIA BULLETIN REQUESTING THE COMMON MEMBERS WITH CONVEYING THE TRUTH 

Why Payments Bank Licensee Fear India Post?

The union cabinet under the chairmanship of prime minister Narendra Modi has given its approval to India Post for setting up India Post Payments Bank (IPPB). India Post Payment Bank will be a public limited company under department of posts with 100 percent government of India equity. In the first phase, the government has cleared India Post Payments Bank expenditure to the tune of Rs 800 crore of which Rs 400 crore will be equity. India Post Payments Bank will seek banking license from RBI by March 2017 and by September 2017 its services will be available pan-India through 650 payments bank branches, linked post offices and alternative channels. The big question is why Payments Bank licensee fear India Post? Tie-ups With Banks: Around 50 banks and financial institutions have shown interest to collaborate with India Post Payments Bank. According to telecom minister Ravi Shankar Prasad, “Citi Bank, Deutsche Bank, Barclays, World Bank and all other banks have shown interest to collaborate with India Post Payments Bank.” Unmatchable Reach: India has the largest postal network in the world with over 154,882 post offices as on March 31, 2014 of which 139,182 (89.86 percent) are in the rural areas. On an average, a post office serves an area of 21.22 square Km and a population of 8,221 people. With Payments Bank license, India Post will further the cause of financial inclusion by providing basic banking, payments and remittance services and facilitate financial services like insurance, mutual funds, pensions and access to credit in tie-up with third party financial providers with special focus on rural areas and the unbanked and under-banked segments. No Payment Banks licensee can match the reach of India Post both in rural and urban areas. Smart Technology Usage: India Post Payments Bank is riding on modern technology by adopting mobiles, ATMs, PoS/ m-PoS devices and simple digital payments solutions to empower postman in rural and urban India, The postal department is planning to provide 120,000 gramin dak sewaks with handheld terminals whereas urban postman will get mobile phone or smartphone by the end of 2016. The India Post ATM has now reached 942 as on May 2016 and plans are to reach 4,000 ATM by March 2017. All these will help in making India Post postman smart and also help in quicker and timely delivery of services. Unparallel Core Banking Network: India Post has the highest number of core banking branches in India and has even surpassed State Bank of India core banking branches. Presently, State Bank of India has 16,066 branches connected to core banking whereas India Post has 22,137 branches connected to the core banking. All these parameters give India Post Payments Bank an edge. India Post will leverage its network, reach and resources to provide simple, low-cost, quality financial to be easily accessible to customers all over the country.

SPEED POST CHARGES ARE INCREASING FROM 01ST June 2016

 Imposing another TAX (krishi Kalyan Cess) 

Service Tax = S.T (14%) + S.B (swatch bharat cess 0.5%) + KKC (0.5%) = 15 %

The proceeds of Krishi Kalyan Cess would be exclusively used for financing initiatives relating to improvement of agriculture and welfare of farmers. The Cess will come into force with effect from 1st June 2016. Budget 2016 as proposed to impose a Cess, called the Krishi Kalyan Cess, @ 0.5% on all taxable services. The new effective service tax could henceforth be 15%. While presenting the Budget 2015, the FM had increased the Service Tax Rate from 12.36% to 14%. This new rate of Service Tax @ 14% was applicable from 1st June 2015. Moreover from 15th Nov 2015, Swachh Bharat Cess @ 0.5% also got applicable. Therefore the effective rate of Service Tax is currently at 14.5% with effect from 15th Nov 2015. It seems, the rate is slowly being increased to bring service tax closer to the expected goods and services tax (GST) rate of 17-18%.