Pune, Jan. 22
THE Executive Director of Bank of Maharashtra (BoM), Mr Ashok Dugade, said here his bank was part of a team of senior officials that met the Post Master General to discuss the possibility of the postman becoming the interface between banks and consumers in rural areas.
"We are considering the possibility of tying up with the post office so that postmen can bring in loan applications and do the initial diligence work for us," Mr Dugade said, adding that in return the postmen would get commission from the bank.
The bank has meanwhile announced that it has entered into an MoU with the Life Insurance Corporation of India for distribution of the latter's products.
"We have short-listed 220 key branches where the products will initially be offered and want to scale this up to 550 branches in two years," Mr Dugade said.
"We have also finalised a foray into non-life insurance sector in collaboration with United India Insurance and will make an announcement on that shortly," he said, adding the bank expects an income of at least Rs 10 crore from the insurance business in the first year.
For LIC, this is the ninth bancassurance tie-up with a public sector bank. LIC has 34 other partnerships with banks in the regional, private sector and co-operative sectors.
"Bancassurance is still at a nascent stage and will take a while before it establishes itself as an alternate channel for life insurance," said Mr S. Vishwanathan, Executive Director, Bancassurance and Alternate Channels.
In the last fiscal, LIC generated Rs 200 crore of business through alternate channels and Mr Vishwanathan said these channels would contribute 20-30 per cent of its total business in the next five years.
LIC is soon to announce a major foray into the micro-finance arena, for which a special team has been set up, Mr Vishwanathan said, adding that work on the various products for this segment will commence next month.
"Once our proposal and products receive the go ahead from the IRDA we will be in the market within the next 3-6 months," he added.
Mr Dugade said that Bank of Maharashtra will focus on generating business from new, as well as untapped segments in the rural and urban areas.
During the special savings bank mobilisation drive, over two lakh new accounts were opened, Mr Dugade said.