The Hindu Business Line : PO schemes gross funds mobilisation up 23 pc

DESPITE the fact that the interest rates on various post office (PO) schemes have fallen drastically in over the last decade, their gross funds mobilisation has increased from Rs 27,292 crore in 1992-93 to Rs 1,45,550 crore by the end of 2003-04, according to an analysis carried out by the Associated Chambers of Commerce and Industry of India (Assocham).

Releasing the analysis here on Saturday, the Assocham President, Mr Mahendra K. Sanghi, pointed out that this dispels the widespread and popular perception that POs in India have been losing their charm in attracting household savings over the years.

According to him, the fact, however, remains that despite interest rates on POs' monthly income account slipping from 13 per cent in 1992-93 to 8 per cent in 2003-04 and those on savings deposits slipping from 5.5 per cent to 3.5 per cent in the period, over 1.4 lakh POs across the country registered an increase of over 23 per cent in their total gross funds mobilisation from 1992-93 to 2003-04.

Mr Sanghi further stated that the POs' deposit schemes such as time deposits, recurring deposits, savings accounts and monthly income accounts have grown by over 37 per cent in the first quarter of the current fiscal against such deposits in the first quarter of the last fiscal.

Not only this, they have registered over 30 per cent increase in their gross savings collections during the period which significantly exceeds the budgetary target for 2004-05. Explaining the reason for the increased savings of households in POs, Mr Sanghi said that Indian households still find POs to be the safest route for investment because of their immense network across the country, easy accessibility and familiarity of the small investors with them.

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