FRDI Bill: Banks’ loss is Postal dept.’s gain?

FRDI Bill: Banks’ loss is Postal dept.’s gain?

What has happened?

The Financial Resolution and Deposit Insurance (FRDI) Bill, 2017, seems to have a positive impact on the Postal department, if the increase in the total deposits in post offices across the Andhra Pradesh Circle in the last two years is any indication.

Switching to Postal service

People are apparently switching over to Postal service from commercial banks fearing flight of their savings

Rise in net deposits

• The total deposits touched Rs. 16,132.28 crore in 2017-18 against Rs. 14,947.24 crore in 2015-16 financial year
• The net deposits stood at Rs. 2031.78 crore in the last fiscal compared with Rs. 507.13 crore in 2015-16

Rise in new accounts in Postal offices

The number of accounts being opened in the post offices has also increased considerably

Five lakh accounts were opened during 2017-18 financial year alone

FRDI bill one of the factors

Though the Postal department did not study the reasons for the ‘impressive growth’, senior officials, in private, say that the FRDI Bill is one of the factors.