The Hindu Business Line : Want groceries? Go to the post office

POST offices in your neighbourhood may never be the same. In a complete revamp of its operations, the postal department is now looking at foraying into the retail sector through strategic tie-ups with large FMCG companies to sell anything from groceries to mobile connections.

The move is aimed at reducing the postal deficit, which stands at Rs 1,300 crore.

Mr Vijay Bhushan, Secretary, Department of Posts, told Business Line, "We are looking at diversifying into sectors other than the financial services to increase our revenue streams. With a countrywide network of post offices, we are looking to leverage our strengths by foraying into the retail sector. We are open to discussion with any company which wants to utilise our presence and manpower."

Post offices in some States have already begun selling cellular pre-paid cards to consumers.

In a bid to be more competitive, the Postal Department is undertaking a system study of the postal network. The department, which celebrates 150 years on October 4, has short-listed consultants to advice the Government on measures that need to be taken to compete in a commercial environment.

"Our experience from offering financial and other premium services have been really good. We have realised Rs 747 crore during 2003-04 from premium products," said Mr Bhushan who is spearheading a campaign to take the postal department out of the deficit, arising out of subsidies given on postal products, by 2007.

The postal department is moving further into the financial sector and is planning to launch card-based payment solutions such as debit cards. The move is being planned in association with Mastercard International.

Full-fledged money changing is another services that is in the offing.

"It is proposed to build capacity of the post office to enable it to diversify the range and quality of the financial services provided," said Mr Bhushan.

On the insurance front, the department is planning to offer new products such as group premium policy, children's policy, pension schemes and term policy. Necessary approvals are being sought from the Insurance Regulatory Development Authority.

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