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Introduction Of Postal Services

With a postal service it is possible to send a letter or package to nearly any destination in the
world for a small fee. Most postal services are government agencies, and they are often
monopolies. They have been established to assure that mail is picked up and delivered on a
regularly scheduled basis with speed and security. In an era of globalization, the role of the
post office and as well as the services it provides has changed significantly. Today, postal
services consist of pick-up, transport and delivery services of letters and printed matter
(newspapers, journals, periodicals, brochures, leaflets, etc.); parcels for domestic or foreign
destinations; post office counter services rendered at counters (sales of stamps, etc); and other
postal services such as mailbox rental. The universal postal system is not only used to send
and receive letters and parcels, but is now being used to send bank documents, pay utility
bills, and deliver goods ordered through the Internet in addition to financial services. The
industry is deeply engaged in the supply chains that have become an integral part of
consumer and industrial product manufacturing and marketing. Consumers benefit not only
from speed of delivery, but also from lower costs as a result of efficiencies of operation.
Innovations such as overnight deliveries and time-definite deliveries have spurred global
competition both by private carriers and by traditional national postal administrations.
Moreover, major courier companies are also in the logistics business and these two sectors
are closely integrated. The efficiency of supply chain industries is entirely dependant on the
performance of these two sectors which makes both courier and logistics industries an
essential component for increasing global competitiveness of industries as well as services.
As countries are members of the Universal Postal Union (UPU) and follow universal service
obligations (USO) conventions, they are obliged to provide basic services with acceptable
quality at affordable prices. The social obligation of the postal sector goes beyond merely
offering universal services. As information is a powerful instrument in enhancing the
development of a society, the role of the postal sector is significant. Technological upgrading
in the postal sector is expected to make it an essential vehicle for future economic, social and
cultural development. Postal services can be utilized for effective public campaigns regarding
health and nutrition issues, spreading education, etc. Postal infrastructure in remote areas may
be used for alternative activities such as schools and dispensaries; postal vehicles in many
places act as mobile libraries; and post office may be used as birth and death registration
offices. To build a global partnership for development, post offices can be used to offer postal
services and linked to other ICT initiatives including rural telephony and developing a house
address system. Finally, the postal sector plays a role in mobilizing household savings. With
such an overwhelming presence in society, many of the services offered by post offices
worldwide may be considered as public good. In a UPU Symposium in 2005, even
Millennium Development Goals (MDGs) are linked with the postal sector. It highlights the
fact that modernization of the postal system is essential to achieve development goals through
disseminating information and using the physical structure and network of the postal system.
Global Features

According to the Universal Postal Union (UPU), during 2004-05 there were around 5.5
million people working as postal staff worldwide; globally, each staff member serves around
1180 people. However, the number of post offices declined by 1.3% on average during the
period 1990-2003 and in 2004-05 there were around 666,000 post offices worldwide. Global
revenue was 204.8 billion Special Drawing rights (SDR) in 2006 and close to 52% of this
was from letters. Among the new products hybrid mail, logistics services, and online internet
services are increasingly popular. 60% of the countries in the world offer advertising mail
services in their domestic service. On average around the world, advertising items represent
37.7% of letter-post items in domestic services and 11.5% of letter-post items in international
services. Nationally the market share of postal departments in the case of letter-post is around
94% (internationally 75%), whereas in the case of parcels domestic service by postal
departments consists of around 29% of market share. They capture only 18% of market share
of the international traffic in parcels. As per UPU statistics in 2005, among the industrialized
countries the USA has the highest level of domestic letter-post traffic in the world, with 199
billion items a year. Japan generates some 25 billion items, while Germany and the UK
generate about 21 billion items each. Among developing countries, China generates the most
domestic letter-post items at more than 23 billion, followed by Brazil with 8.6 billion and
India with 7.3 billion. Each day, over 15 million letter-post items are sent beyond national
borders. In 2005, this represented an annual traffic of 5.6 billion international items.
Industrialized countries generate 72.9% of international letter-post traffic, followed by the
Asia-Pacific region with 10.1%. The USA (about 830 million) and the UK (almost 450
million) are among the largest exporters of letter- post items. Of the developing countries,
India (102 million) sends the largest numbers of letter-post items abroad. In the case of
revenue generation, as per 2003 statistics globally almost 58% of revenue was generated by
letter-post followed by 23% by parcels and logistics services, 14% by postal financial
services, and 5% by other services. However, it varies from one region to another. In Europe
and CIS countries, letter-post generated 44% of postal revenue in 2003, followed by 26% by
financial services and 24% from other products. Only 6% revenue was generated from postal
parcels and logistics services. Most of these services are now provided by courier companies
and the sector is fairly open and competitive. Hence, the share of the postal sector in these
products has come down significantly. In contrast, in the Asia-Pacific region, 42% postal
revenue in 2003 came from financial services and letter-post contributed 31%. Postal parcel
and logistics services from the postal department generated 13% of revenue in 2003 and
other products contributed 14%. In industrialized countries during 2003, 85% of domestic
and international services of the letter-post market was open for competition and the figure
was 89% for domestic and international parcel services. In Europe and the CIS, 80% of the
domestic services and 84% of the international services faced competition in 2003. In the
case of postal services, 88% of both domestic and international services are now open for
competition. In contrast, in the Asia-Pacific region, 82% of domestic and international
services of letter-post market are facing competition and, in the case of postal services, 88%
of the domestic services and 100% of international services are now open. No comprehensive
sources of trade data pertaining to courier services have been identified. However, available
information on the activities of the major courier service suppliers may shed some light on
the economic environment for these services. Globally, the leading companies are DHL
Worldwide Express (DHL), United Parcel Service (UPS), Federal Express (FedEx) and TNT.
In the U.S. market, the large companies tend to specialize in overnight courier services,
whereas the smaller companies more commonly provide same-day local delivery.
Considering both the express and parcel market together, apart from these four major players,
La Posted and Royal Mail also hold a significant share in EU-12. In these EU countries
together, DHLs share in the express and parcel market was around 18% in 2006. La Posted
controls 10.6%, TNT around 10.3%, Royal Mail 6.5%, UPS 7.8% and FedEx around 2.3%
(as per figures in 2006). Hence the control of US companies in the major EU countries is
relatively low.
Globalization and Changing Features of the Postal Sector

In view of worldwide structural changes, market liberalization and technological

developments, postal services are also undergoing sea changes. The traditional postal system
will have to face a dynamic business environment and the protection of its monopoly position
is a major question. Currently, there are debates to ensure the sustainability of universal
service obligation (USO) of the postal system. Universal service is a set of measures that
aims to permanently grant all users in all points of a territory a sufficient level of service.
These obligations take the form of constraints, and apply to a range of products or services.
They involve quality, in the broad sense, and price controls. The existence of obligations
means that, in their absence, the market may not provide a sufficient level of service, or the
whole scope of products, or at least not at an affordable price level for all users. Some
countries have tightened the regulations for the monopoly position of the government postal
department; other countries have cross-subsidized the basic system and allowed courier
companies to step in for value-added services; and some countries have even generated funds
for USO. The postal sector is now at a crossroads. The major challenges are mainly two-fold:
the future use of the postal network for revenue generation and making use of the private
sector. These require framing of appropriate regulations, quality of service and restructuring
of the sector. For this the scope of the postal services needs to be expanded and appropriate
services to be devised and delivered.
One of the important challenges to postal and courier services, both public and private, is
competition from other communications services such as facsimile, electronic mail, and data
networks, particularly in the business-to-business and private-to-private market segments.
However, other segment such as business-to-private mail may be less affected by new
communications technologies, as long as public postal services are run in an efficient and
customer-oriented manner and access to postal services remains more widely available to
residential customers than in-home computer terminals.

Trade in Services in the Postal and Courier Sector

International trade in postal services is already open in most countries and the share of the
postal department is increasingly coming down both in the letter-post and parcel markets. The
share of private courier companies in these products has gone up over the years. Due to the
growing communications market, many countries have opened the express delivery services
to private players including foreign companies. The leading global companies such as DHL
Worldwide Express (DHL), United Parcel Service (UPS), Federal Express, and TNT have
established affiliates in foreign countries to capitalize on rapidly expanding global demand
for express courier services. Trade in postal and courier services has traditionally been
through cross-border supply among postal agencies (Mode 1). Due to the opening up of
services, commercial presence (Mode 3) of companies has become the most important mode
for international trade in this sector. Companies have either revenue-sharing business partners
abroad who work like agents or they have joint ventures or wholly-owned subsidiaries.
Competition is intense both in the letters as well as the parcel market. Large companies take
advantage of superior technology to ensure quality and speed of delivery. Due to the infusion
of IT, many companies have deep penetration in markets outside their home countries. It must
be noted that some part of the domestic letter and postal market is still protected due to
universal service obligation but the international letter and parcel market is significantly open
and the nature of competition is intense.

The UPU forecasts that international mail will experience stronger growth, with low-income
countries expected to have the highest average annual growth rate but will decline due to
electronic mail, fax and telephones mainly in the developed countries. The decline, in the
presence of upward forecasts for physical mail volumes, reflects the fact that the total
communications market is growing at a faster rate than the postal market. The UPU cites
economic factors which, however, vary greatly depending on region and socio-economic
environment as the foremost determinant of letter traffic volumes. It ranks as second various
postal factors such as quality of service. It describes these and other factors such as
population growth and education as having a greater impact than technological factors and
the substitution of other means of communications (such as electronic mail and the Internet)
when the population as a whole is taken into account.

International trade in postal and courier services is now identified as one of the major sectors
in GATS negotiations at the WTO. The core international postal services
consist of non-expedited delivery of letter-post mail (letters, small packets, printed matter,
and publishers' periodicals). Countries are now seeking market access and national
treatment in the postal and express delivery sector through GATS negotiations. Since 1994,
43 Members have scheduled commitments opening access to courier services but few
commitments have been made in postal services considering the sensitivity of the sector as
a significant amount of the services offered by postal sector are public good in nature. Many
countries have agreed to unlimited access to courier services through cross-border supply or
through commercial presence, without significant terms or conditions. Many have also
committed to providing non -discriminatory access to foreign suppliers of courier services.
Some Members that did not include courier services in their scheduled commitments have
nonetheless allowed foreign courier service suppliers to operate in their markets. Since 2001,
there have been six proposals focused on express delivery and postal and courier services
from the EC, Hong Kong, the U.S., Switzerland, New Zealand and Mercosur/Bolivia. All
support the creation of a new category of express delivery services, which would recognize
that the dichotomy between (public monopoly) postal and (private) courier services is
increasingly obsolete as postal reform advances. Negotiators could then bargain for access for
express delivery in key markets. India has not yet submitted any commitments in this sector
considering its sensitivity. This is important to note as multilateral discussion in the sector has
not yet been firmed up; many countries are attempting to include the postal and courier sector
in bilateral/regional services agreements. The USA has done this through the US-Andean
Pact and the US-Singapore agreement; the EU has included this in the EU-Chile Agreement.
In contrast, India has not included it in the India Singapore Comprehensive Economic
Cooperation Agreement, the only bill including services that India has signed as of Oct 2008.
The large employment by India Post and the existence of numerous SME players in the sector
have been causes of concern for the government.
Mail Services

The primary function of post office is collection, processing , transmission and delivery of
mails. All postal articles whose contents are in the nature of message can be classified as
Mails which includes Letters, Postcard, Inland letter card, packets, Ordinary, registered,
insured, Value payable articles, speed post. These are classified as first class and second class
mails. First class mails get free Air mail transmission within India; whereas second class
mails get air lift only if prepaid with air surcharge. These four stages of mail operation have a
single aim Delivery of mail to its addressee.

The mail is collected from 579595 letter boxes by 154979 post offices in the cournty.This is
processed by a net work of 389 mail offices and 89 national speed post hub and conveyed by
road, rail and airlines all over the country.

Traditionally mails were handled on a regular line or path and their concepts were based upon
fundamental rules laid down for its operations causing more disadvantages and dissatisfaction
to the customer. To overcome these drawbacks India Post has embarked upon a massive
exercise to review and restructure the mail operations starting from booking to delivery of

Services Associated With Traditional Postal Communication

1. Recall of Articles:

During the course of transmission a sender could request the recall of postal article or ask to
deliver it to another addressee, provided the following conditions are met.

It has not been delivered to the addressee.

It has not been confiscated or destroyed by the competent authorities of the country in
which the article may be for the time being.
It has not been seized by virtue of any law of the country of destination.

2. Poste Restante:
It is intended to cater to postal communication needs of travelers. All articles superscribed
C/O POSTMASTER or in any other similar way are called poste restante articles. A poste
restante article has to be collected by the addressee from the Post Office.

3. Post Box:

Customers may get their mail at the post office through Post Boxes which are rented out by
the post office. Only fully prepaid articles except parcels are delivered through post boxes.
The customer has to pay prescribed rent and a deposit. The customer will be supplied with a
Delivery Ticket which should be produced by the customer/his agent when demanded.

4. Post Bag:

This system is available in all delivery post offices. In this system a bag with a lock and keys
in duplicate are to be supplied by the customer. All fully prepaid unregistered articles
addressed to the customer will be placed inside the bag and handed over to the customer
during the business hours prescribed for window delivery.

5. Identification Cards:

Post office issues Identity cards for the benefit of travelers, tourists and other customers. The
card contains photograph of the holder, his signature and full description. The validity period
is three years.

6. Business Reply Service:

A person who wishes to get reply from his client can use this facility on payment of
prescribed fees. Such cards, envelopes can be posted by the client without any postage.


Automated Mail processing centre at major locations in the country has been set up to create
an Automated Mail grid. Dedicated transport arrangements both road and air are made for
expeditious transmission of mails. The department has undertaken Mail net work
optimization project to improve the quality of mail processing, transmission and delivery. The
project seeks to optimize the existing mail network with a view to streamline core mail
operations and to bring in greater standardization and improvement in the operational
processes relating to mail processing, transmission and delivery. The visibility of
transmission has been enhanced by providing track and trace facility for speed post and
registered mail. The customer can track the mail through India Post website by using the
unique barcode number. Project arrow launched in 2008 aims to improve the core operations
of a post office which includes the improvement of delivery efficiency for all kinds of articles
. About 15000+ post offices have been covered under project arrow. Mail business centre was
conceptualized in important towns in the year 2006 as a key component of the new paradigm
for Mail management. It focuses on one stop solution to the bulk mailers providing all
premailing activities and other value added services.


1. Letter: The communication is enclosed in an envelope and addressed. Inland Letter

Card Communication is contained on a sheet of paper with prescribed size &folding .

2. Post Card: Open communication on a card of prescribed size. Available in two

varieties: Single & reply post card. Post cards are for transmission within India only.
Dimensions 14 cm 9 cm (length and breadth). Privately manufactured post cards
shall not be thinner or more flexible than an embossed post card, and will have the
same size and thickness of embossed post card. There are other varieties of Post cards
also such as

3. Printed Post Card :- Post cards containing communication recorded by printing,

cyclostyling or by any other mechanical process are classified as 'Printed Post Cards'.
Printed matter includes printed pictures also.

4. Parcel: Anything can be sent in a parcel excepting articles whose transmission is

prohibited. It can contain single communication to the addressee of the parcel. If the
parcel is suspected to contain other than the permitted communication, it will be
opened in the presence of the addressee or his authorized agent, and each written
communication will be charged on delivery with double the letter postage. If the
addressee refuses to pay the charges, the parcel will be returned to the sender from
whom the charge will not be recovered.

5. Insurance: Insurance covers all risks during the course of transmission by post. The
following types of articles can be insured:

Registered letters
Value Payable Letters
Registered Parcels
Value Payable Parcels

Premium services
The very high speed express service for letters and documents. Speed Post links more than
1200 towns in India, with 290 Speed Post Centres in the national network and around 1000
Speed Post Centres in the state network. For regular users, Speed Post provides delivery
anywhere in India under contractual service. Speed Post offers a money-back guarantee,
under which the Speed Post fee will be refunded if the consignment is not delivered within
the published delivery norms. With a view to provide convenience for the customers , Speed Post provides
collection from the premises of the customers through on-call collection and regular
collection at some of he towns. For corporate customers and regular users , Speed Post
provides many value added services including pick-up from the premises, convenient
monthly billings, account management facilities, assistance in import / export procedures of
shipments, corporate tracking facilities, volume discounts etc. When you open a Speed Post
account, you open the door to convenience and customized solutions, as per your

2) Logistics post:

A brand new service from India Post great for sending parcels and large consignments across
the nation and around the world. Logistics Post manages the entire distribution side of the
logistics infrastructure from collection to distribution, from storage to carriage, from order
preparation to order fulfilment. Logistics Post is an ideal service for sending large
consignments including multi-parcels, just-in-time parcels, bulk-break consignments and
goods of any weight. While Parcel Post offers weight up to 35 kg, Logistics Post has no
weight limit. Logistics Post offers not only physical logistics services but also provides
comprehensive supply chain management services, leading to improvement in the service

3)Business post

Business Post provides total mailing solutions to the businesses from mail preparation to
mail delivery. It is a one-stop shop service that manages entire mail-out process, for small
businesses as well as large companies. Customers can choose from a range of cost-effective
and professional mailing services, including printing, collating, inserting, sealing, and
addressing to meet their specific business needs. In order to speed up the mail delivery,
special despatch direct to destination post office and special delivery arrangements can also
be made under Business Post .Business Post handles all business mail processing to make the
task easy and convenient for the customer. Outsourcing the business mail processing needs to
India Post means that the company can redirect precious resources to its core business
activities. It makes sound business sense. Business Post services are available in Business
Post Centres which have been established in major towns. Business Post Centres are
available at major post offices. Under Business Post, the amount payable for Business Post
services is received in advance.

4) Express Parcel
Express Parcel service will be available to both retail as well as business (corporate)
customers. Express Parcel is an air express parcel product providing time bound delivery of
parcels. These parcels will be transmitted through air or any other fastest mean available. All
Express Parcel consignments shall be given door delivery irrespective of its weight. Business/
Corporate customers are provided pick-up facility from their premises.

5) Media post

India Post offers an unique media concept to help the Indian corporate and the Government
organizations reach potentialcustomers through Media Post. Creative, cost-effective and
personalized, its over packed. Absolutely no other media can match the sheer expanse of
India Post in terms of volume and reach .media post an innovative & effective vehicle for
Brand and Marketing managers to communicate their corporate messages across the
nation. Now, your brand could take the fast track and reach the masses at a low cost with
Media Post. Advertisement on postcards, letters, postal stationary etc.

6) Greeting Post
These cards come ready with pre-paid postage envelopes thereby eliminating the need to
affix stamps: a unique concept for the first time in India. Whats more fascinating, the postage
stamps are an exact replica of the cards inside. And its not only convenience that these cards
offer, but a lot more. Through Greeting Post you can express yourself perfectly on every
occasion, festival or event.



Public Provident Fund Account
A) Ideal investment option for both salaried as well as self employed classes.
B) Non-Resident Indians (NRIs) are not eligible.
C) Investment up to INR. 1,00,000 per annum qualifies for IT Rebate under section 80 C
of IT Act.

D) The rate of interest on the subscriptions made to the fund on or after 01.12.2011 and
balances at credit of the subscriber in the existing PPF account shall bear interest at the rate
of eight point seven per cent (8.70%) per annum.
E) Loan facility available from 3rd financial year upto 5th financial year. The rate of
interest charged on loan taken by the subscriber of a PPF account on or after 01.12.2011 shall
be 2% p.a. However, the rate of interest of 1% p.a. shall continue to be charged on the loans
already taken or taken up to 30.11.2011.

F) Withdrawal permitted from 6th financial year.

G) Free from court attachment.
H) An individual cannot invest on behalf of HUF (Hindu Undivided Family) or
Association of persons.

Type of Account Minimum limit Maximum limit

Public Provident
Fund(Individual account on
his behalf or on behalf of
minor of whom he is the INR. 1,00,000/- in a financial
guardian) INR. 500/- in a financial year year

National Savings Certificate :

NSC 7th Issue
Scheme specially designed for Government employees, Businessmen and other
salaried classes who are Income Tax assesses.
No maximum limit for investment.
No Tax deduction at source.
Certificates can be kept as collateral security to get loan from banks.
Investment up to INR 1,00,000/- per annum qualifies for IT Rebate under section 80C
of Income Tax Act.
Trust and HUF cannot invest.
Rate of interest 8.50%.
Maturity value of a certificate of INR.100/- purchased on or after 1.4.2012 shall be
INR. 151.62 after 5 years.

NSC 9th Issue

No maximum limit for investment.
INR. 100/- grows to INR 234.35 after 10 years.
Minimum INR. 100/- No maximum limit available in denominations of INR. 100/-,
500/-, 1000/-, 5000/- & INR. 10,000/-.
A single holder type certificate can be purchased by an adult for himself or on behalf
of a minor or to a minor.
Rate of interest 8.80%.
Maturity value of a certificate of INR.100/- purchased on or after 1.4.2012 shall be
INR. 236.60 after 10 years.
Buy National Savings Certificates (NSCs) every month for Five years Re-invest on
maturity and relax - On retirement it will fetch you monthly pension as the NSC matures.

Savings Account
Any individual can open an account.
Cheque facility available.

Group Account, Institutional Account, other Accounts like Security Deposit account
& Official Capacity account are not permissible

Rate of interest 4% per annum

Monthly Income Scheme (MIS) Account

Safe & sure way to get a regular monthly income.
Specially suited for retired employees/ Senior Citizens or any one with high sum for
Rate of interest 8.40%.
Maturity Period - Five Years.
No Bonus on Maturity w.e.f. 01.12.2011.
Auto credit facility to SB Account.

Type of Account Minimum limit Maximum limit

Single INR 1500/- INR 4.5 lakhs

Joint INR 1500/- INR 9 lakhs

Above scheme operates automatically, if you open a saving bank account and give a request
for automatic transfer of Monthly Income Scheme interest to Recurring Deposit through
Saving Bank account.


KVP is a saving scheme that was announced by the government of India that double the
money invested in 8years 7months. It can encash after two and half years from date of issue.
Farmers buy these certificates and revenue earned buy the government will be used for

Recurring Deposit Account

Any individual (a single adult or two adults jointly) can open an account.
Advance Deposits earn rebate.
Four defaults are allowed.
Rate of interest 8.40%
Defaults can be paid within two months.
Part withdrawal facility available.
Premature closure allowed after three years.
Pay Roll Savings Scheme is also available for employees of various Establishments.
Time Deposit Account
Any individual (a single adult or two adults jointly) can open an account.
Group Accounts, Institutional Accounts and Misc. account not permissible.
Trust, Regimental Fund or Welfare Fund not permissible to invest.
1 Year, 2 Year, 3 Year and 5 Year Time Deposit can be opened.

In case of premature closure of 1 year, 2 Year, 3 Year or 5 Year account on or after

01.12.2011, if the deposit is withdrawn after 6 months but before the expiry of one year from
the date of deposit, simple interest at the rate applicable to from time to time to post office
savings account shall be payable.

In case of premature closure of 2 year, 3 year or 5 year account on or after 01.12.2011,

if the deposit is withdrawn after the expiry of one year from the date of deposit, interest on
such deposits shall be calculated at the rate, which shall be one per cent less than the rate
specified for a period of deposit of 1 year, 2 year or 3 years as mentioned in the concerned
table given under Rule 7 of Post office Time Deposit Rules.

Rate of interest - 8.40%, 8.40%, 8.40%, 8.50% compounded quarterly for 1,2,3 & 5
years TD account respectively w.e.f.01/01/2014.
Senior Citizen Savings Scheme (SCSS) Account
A new avenue of investment and return for Senior Citizen.
The account may be opened by an individual,
1. Who has attained age of 60 years or above on the date of opening of the account.
2. Who has attained the age 55 years or more but less than 60 years and has retired under
a Voluntary Retirement Scheme or a Special Voluntary Retirement Scheme on the date
of opening of the account within three months from the date of retirement.
3. No age limit for the retired personnel of Defence services provided they fulfill other
specified conditions.
The account may be opened in individual capacity or jointly with spouse.
Non-resident Indians (NRIs) and Hindu Undivided Family (HUF) are not eligible to
open an account.
The individual may open one or more account in the multiple of INR.1000/-, subject
to a maximum limit of INR.15 lakh.

PLI was introduced on 1st February 1884 with the express approval of the Secretary of State
(for India) to Her Majesty, the Queen Empress of India. It was essentially a scheme of State
Insurance mooted by the then Director General of Post Offices, Mr. F.R. Hogg in 1881 as a
welfare scheme for the benefit of Postal employees and later extended to the employees of
Telegraph department in 1888. In 1894, PLI extended insurance cover to female employees
of P & T Department at a time when no other insurance company covered female lives. It is
the oldest Life insurer in this country.In the beginning, the upper limit of life insurance was
only Rs 4000/- which has now increased to Rs 10 lacs (Rupees Ten Lacs) for all schemes
combined - Endowment Assurance and Whole Life Assurance. Over the years, PLI has grown
substantially from a few hundred policies in 1884 to 42,83,302 policies as on 31.03.2010. It
now covers employees of Central and State Governments, Central and State Public Sector
Undertakings, Universities, Government aided Educational institutions, Nationalized Banks,
Local bodies etc. PLI also extends the facility of insurance to the officers and staff of the
Defence services and Para-Military forces. Apart from single insurance policies, Postal Life
Insurance also manages a Group Insurance scheme for the Extra Departmental Employees
(Gramin Dak Sevaks) of the Department of Posts.PLI is an exempted insurer under Section
118 (c) of the Insurance Act of 1938. It is also exempted under Section 44 (d) of LIC Act,


Money Order:

This is a domestic money transfer facility through post office. Money send through money
order is paid at the door-step of the payee and this service is available in all post offices .
Maximum amount which can be remitted through a single money order is Rs.5000/-.
Remitter can pay the amount in cash or cheque at the booking office and the charges for the
service is 5% of the value of money to be transmitted. Remitter gets acknowledgement signed
by the payee.there is a provision for sending short communication also along with the money

Electronic Money Order (eMO):

Introduced on 10.10.2008. eMO system aims to simplify the transmission process of money
orders by ensuring quick and secure electronic transmission. Time taken for Transmission is
very less & amount is paid within a day of booking . the amount of money order is paid in
cash at the door step of the payee. Facility for remitting money from one to one, one to many
and many to one is available under this service. eMO can be booked at authorized POs, but
paid through all delivery POs in the country. commission for eMO is same as applicable to
money order. The eMOs can be tracked through Indiapost website.

Instant Money Order (iMO):

India Post provides instant Money Order service, which is Instant, Safe, Reliable &
Convenient. Amount from Rs.1000/- to Rs.50000/- can be remitted through designated iMO
Post Offices. It is an instant web based money transfer service. Remitter has to fill-up
prescribed form & should produce valid photo identity. Money Order Commission varies
based on the amount of remittance. There are 33 standard messages for selection by the
remitter. Payee has to visit the post office, fill up the prescribed form and produce the identity
proof to receive the money. Amount recieved can also be credited to the savings bank account
of the payee.

MO Videsh:

This is an international remittance service offered by Indiapost to most foreign destinations.

Outward remittance is payable to beneficiaries by crediting the payment to the bank account
of beneficieries in the destination countries. Each outward remittance shall not exceed 5000
USD & maximum 12 outward remittances are allowed in a year. This facility is available in
all computerized post offices. The commission for MO Videsh vary with the amount to be

International Money Transfer Service:

Indiapost is also offering inward international money transfer through collaboration with
western union money transfer and Money gram. The service is safe, fast & reliable. It is a
quick and easy way of transferring personal remittance from abroad to beneficiaries in India.
Money can be received from 195 countries through identified post offices. Recipients can
receive money in minutes after the remitter remits money. A maximum of 2500 USD can be
recieved at a time. 12 transactions can be received by a single beneficiary in a calendar year.
Amount upto Rs.50000/- in cash and more than that in cheque or credited to savings accounts
in PO


The Post Office has traditionally been a distributor of financial services, from money orders
to banking services. The Post Office Savings Bank is the largest retail bank in the country,
operating from over 1,50,000 branches. With an objective to leverage the strength of the
postal network and skills Department of Posts had started retailing mutual funds and bonds.

On 22nd January 2001, India Post in partnership with IDBI-Principal, launched a scheme for
distribution of mutual funds through post offices. A pilot project was started from the four
cities of Delhi, Mumbai, Kolkata and Patna. Thereafter from 15th June 2001 onwards, the
scheme was extended to cover post offices in all major capital and other cities all across the
country. At present select schemes of Principal, SBI, UTI, Franklin Templeton and Reliance
Mutual Fund are retailed through designated post offices in the country.

Forex Services

High growth Indian economy coupled with globalisation has resulted in thousands of Indians
going abroad for travel, studies and business. Simultaneously, there is a huge inflow of
foreign tourists visiting India on vocation and business. This has resulted in the need for a
reliable and quality service provider for purchase and sale of Foreign Exchange.

Each one of them requires reliable, affordable and convenient Forex services. At many
places, there is no Bank or other facilities to avail foreign exchange. India Post, with a
network of more than 155,000 post offices, is best poised to offer Forex services in an
efficient and economical manner. Now India Post, in association with HDFC Bank, provides
Forex services through select Post Offices across India. HDFC Bank is one of the leading
providers of Forex services and through this association, India Post brings to the customers a
range of Forex services in a professional and efficient manner.

Retail Services

Through its vast network of Post Offices across the country, India Post offers the facility to
collect consumer bills for service industries like telephone / electricity / mobile phone users
etc for Government and private organizations through Retail Post. Post Offices also sell
forms for public bodies across counter of Post Office. Besides this, facility of reservation of
Railway Tickets through computerized passenger reservation system terminals has been
commenced from 7.10.2007 in selected Post Offices. Retail Post leverages the vast network
of Post Offices for sale of products across the counter on behalf of other organizations. It
projects India Post as a 'One Stop Solution Provider' for various utility services and it is in a
position to offer the retail services to the customers of any agency. Some of the agency
services that Retail Post offers are as follows:

Telephone revenue collection

e-Ticketing for Road Transport Corporations and Airlines
Sale of UPSC forms, University applications, etc
Sale of Passport application forms
Sale of Gold Coins, Forex Services
Sale of SIM and recharge coupons
Sale of India Telephone cards
e-Ticketing of Railway tickets

The Heads of Circles have also been empowered to provide various area specific business
packages under Retail Post in their Circles.
Bill Mail Service

Communications in the nature of financial statements, bills, monthly account bills or any
such other items of similar nature may be posted by a service provider to customers atleast
once in 90 days under this service.

The Bill Mail Service does not include communication in the nature of letter mail or having
personal communication or exclusive commercial publicity material. Inclusions (those
permitted under Direct Post) are permitted at INR 0.25 per insertion.


e-Payment is a smart option for businesses and organizations to collect their bills or other
payments through Post Office network. When businesses require collection of bills and other
payments from customers across the country, Post Office offers them a simple and convenient
solution in the form of e-Payment. e-Payment is a many-to-one solution which allows
collection of money (telephone bills, electricity bills, examination fee, taxes, university fee,
school fee etc.) on behalf of any organization. The collection is consolidated electronically
using web based software and payment is made centrally through cheque from a specifed
Post Office of biller's choice. The information and MIS regarding the payment can be had by
the biller online.


Review of Literature
Literature suggests that some research in the area of investors behavior has been done by
behavioral scientists such as Weber (1999), Shiller (2000) and Shefrin (2000).
Gavini and Athma (1999) found that social considerations, tax benefits, and
provision for old age were the reasons cited for saving in urban areas, whereas to
provide for old age was the main reason in rural areas. Among the post office
schemes, Indira Vikas Patra ( IVP), KVP and Post Office Recurring Deposit Account
( PORD) were the most popular, in both urban and rural areas.
Somasundaram (1998) has found that bank deposits and chit funds were the best
known modes of savings among investors and the least known modes were Unit
Trust of India ( UTI) schemes and plantation schemes. Attitudes of investors were
highly positive and showed their intention to save for better future. Nearly two-thirds
of the investors were satisfied with their savings. Both income and expenses of a
family influenced the level of satisfaction over savings. A large proportion of
investors were concerned about their children's well-being. Among the dissatisfied
investors, majority were of the opinion that cost of living was too high. The most
common mode of investment was bank deposits. However, a shift was noticed from
bank deposits to other forms of investment. Almost all the investors had invested in
gold and silver. Among several parameters in investing, safety of money was
considered to be the most important element. Next, the investors expected regular
return from their investments.
Shefrin (1999) defined behavioural finance as a rapidly growing area that deals with
the influence of Psychology on the behavior of financial practitioner.
Belsky and Gilovich (1999) have termed behavioural finance as behavioural
economics and further defined behavioural economics as combiningthe twin
discipline of psychology and economics to explain why and how people make
seemingly irrational or illogical decisions when they save, invest, spend and borrow
Khorana and Servaes (1999) had experimented that the decision to introduce a new
type of fund is affected by a number of variables, including investor demand for the
funds attributes.
Chakarabarti and Rungta (2000) stressed the importance of brand effect in
determining the competitive position of the AMCs. Their study reveals that brand
image factor, though cannot be easily captured by computable performance measures,
influences the investors perception and hence his fund/scheme selection.

Shanmugham (2000) conducted a survey of 201 individual investors to study the

information sourcing by investors, their perceptions of various investment strategy
dimensions and the factors motivating share investment decisions, and reports that
among the various factors, psychological and sociological factors dominate the
economic factors in investment decisions. In his study Are Retail Investors Better off
Today? Black (2004) observed that in recent years, investors' attitudes towards the
securities industry plummeted, in reaction to both the conflicted research and the
mutual fund scandals. He concluded that the most optimistic assessment is that the
SEC has plenty of unfinished business to attend to.

Shiller (2000) strongly advocated that stock market is governed by the market
information which directly affects the behavior of the investors.

Karthikeyan (2001) has conducted research on Small Investors' Perception on Post

Office Saving Schemes and found that there was significant difference among the
four age groups, in the level of awareness for Kisan Vikas Patra ( KVP), National
Savings Schemes ( NSS), and Deposit Scheme for Retired Employees ( DSRE), and
the overall score confirmed that the level of awareness among investors in the old age
group was higher than in those of the young age group. No difference was observed
between male and female investors except for the NSS and KVP. Out of the factors
analysed, necessity of life and tax benefits were the two major ones that influence the
investors both in semi-urban and urban areas. Majority (73.3 per cent) of investors of
both semi-urban and urban areas were very much willing to invest in small savings
schemes in future provided they have more for savings.

Johnsson Malena, Lindblom Henrik, Platan Peter (2002) in their thesis submitted
to School Of Economics and management, Lund University on Behavioural Finance
and the change of investors behaviour during and after the speculative bubbles at the
end of 1990s stated that the apparent high price earnings ratios experienced by the
equity market at the end of 1990s can be characterized as so called speculative
bubbles. The study emphasized on finding out what factors lie behind the speculative
bubbles and further investigates whether the investment objectives and the factors
influencing investment decision-making are different today than during speculative
bubble. The result obtained from the study suggests that the behaviour of the market
participants during the speculative bubble was to some extent irrational and that the
composition of investments has undergone a lot of changes as a consequence of
speculative bubbles.

Jay R. Ritter (2003) in his article on behavioural finance published in Pacific Basin
Finance Journal Vol. No 4 has provided a brief introduction about behavioural
finance.As per the article behavioural finance encompasses research that drops the
traditional assumption of expected utility maximization with rational investors in
efficient markets. The two building blocks of behavioural finance are cognitive
psychology ( how people think ) and the limits to arbitrage ( when market will be
inefficient ) The article further highlights that the growth of behavioural finance
research has been fueled by the inability of traditional framework to explain empirical
patterns, including stock market bubbles in Japan, Taiwan and the US.

Lynch and Musto(2003) were of the opinion that this decade will belong to mutual
funds because the ordinary investor does not have the time, experience and patience
to take independent investment decision on his own.

Power David, Helliar Christine and Burton Bruce (2003) in their research paper
A Behavioural Finance Perspective on IPO and SEO, have detailed the findings of
an extensive investigation into how and why UK firms raise equity capital. The study
demonstrates that a negative interpretation of poor share prices performance is seen as
having the potential to harm a firms business as well as market prospects. The study
highlightsthe difficulty in undertaking an IPO and the new mind set is required to
manage relationship with investors once the listing was obtained.

Jawaharlal and Nikhil Pareek(2004) analyzed the customer service in Life

insurance. In Insurance chronicle he had analysed the different services of Life
Insurance players in India.

Keli (2005) is of opinion that Past performance and Funds Investment Strategy
continued to be the top two drivers in the selection of a new fund manager.
Rajeswari and Moorthy (2005) observed that investors are basically influenced by
intrinsic qualities of product and general image of the fund / scheme in their selection
of fund/schemes. They observed that investors demand inter-temporal wealth shifting
as they progress through the life cycle.
Hussein A. Hassan AI Tamimi (2005), in his article Factors influencing
individual investors behavior: An Empirical study of UAE Financial Market , aimed
at identifying factors influencing the UAE investor Behaviour by developing a
modified questionnaire. The study identified six factors found to be most influencing
the UAE investor behavior. The factors in order of importance were: expected
corporate earnings, get rich quick, stock marketability, past performance of the firms
stock , government holding and creation of organized financial markets, family
member opinion etc.
Omar and Frimpong (2006) stressed the importance of life insurance and regarded it
as a saving medium, financial investment, or a way of dealing with risks.
Sewell (2007) has stated that behavioural finance as a science regarding how
psychology influences financial market. This view emphasizes that the individuals are
affected by psychological factors like cognitive biases in their decision making, rather
than being rational and wealth maximizing.
Schindler ( 2007) has given certain examples while defining behavioural finance
1. Investors biases when making decisions and thus letting their choices to be influenced
by optimism, overconfidence, conservatism.
2. Experience and heuristics help in making complexdecisions.

Rajkumari (2007) in her study has undertaken to identify the customers attitude
towards purchase of insurance products concludes that there is a low level of
awareness about insurance products among customers in India.
Alinvi&Babri (2007) are of view that customers preferences change on a constant
basis, and organizations adjust in order to meet these changes to remain competitive
and profitable.
Bhagaban Das , Ms Sangeeta Mohanty &Mr. Nikhil Chandra Shil(2008) observ
that different investment pattern do not provide the same level of services with
respect to age of retail investors in India. It was also observed that graduate and post
graduate investors invest more in life Insurance while professionals in Mutual Funds.
Forbes (2009)defined behavioural finance as a science regarding how psychology
influences financial market. This view emphasizes that the individuals are affected by
psychological factors like cognitive biases in their decision making, rather than being
rational and wealth maximizing.
Simon Gervais (2009) in BehaviouralFinance: Capital Budgeting and other
Investment Decisions has made a survey of literatures on the effects of behavioural
biases on capital budgeting. As per the study, a large body of psychology literature
finds that people tend to be overconfident and overly optimistic. Because of self-
selection, firm managers tend to be even more affected by these biases than the
general population. Indeed the literature find that the biased managers over-invest
their firms cash flows, initiate too many mergers, start more firms and more novel
projects and tend to stick with unprofitable investment projects longer. Corrective
measures to reduce the effect of manager biases include learning, inflated discount
rates and contractual incentives but their effectiveness in curbing over investment
appears to be limited.
Nagpal Sushant and Bodla B. S., ( 2009 )brings out the demographic characteristics
of investors, relationship between lifestyle clusters of the respondents and their
investment patterns and sources of information tapped by them . The study concluded
that investors prefer less risky investments such as insurance policies, fixed deposits
with banks and post office, PPF and NSC.
The objective of this study is to analyze trade and investment opportunities between India
and EU member countries in the postal and courier sector in the context of the India-EU
Trade and Investment Agreement. The paper discusses the market structure, regulation and
liberalization in this sector in India and the EU, lists the trade barriers and suggests
negotiating strategies for the Indian government. Reforms have been suggested which would
enhance the productivity and global competitiveness of this sector and enable India to benefit
from unilateral, bilateral or multilateral liberalization.Department of Posts is committed to
providing universal access to basic postal services in the country at affordable prices. Its
objectives are to.Ensure availability of basic postal services in all parts of the country,
including tribal, hilly and remote areas.
Provide efficient reliable and economic service.
Provide value added services according to market requirements.
Modernize the services to handle the growing volume of work with efficiency and
thereby enhance customer and employee satisfaction.
Be a forward looking organization, and Generate more resources and improve
financial performance.As per Government of India (Allocation of Business) Rules,
1961, second Schedule, Rule 3, Distribution of Subjects among the Departments the
Department Of Posts is responsible for
Execution of works, including purchase of land debitable to the Capital Budget
pertaining to the Department of Posts.
Posts, including Post Office Savings Banks (Administration), Post Office Certificate
(Administration), Post Office Life Insurance Fund (Administration), printing of
public postage stamps/commemorative stamps including postal stationery, premium
postal products and any agency function.
International cooperation in matters connected with postal communications, including
matters relating to all international bodies dealing with postal communications such
as Universal Postal Union, Asia Pacific Postal Union (APU), Commonwealth Postal
Matters relating to introduction, development and maintenance of all services by the
Post Office including those based on cable, radio and satellite communications
Area of Study
The importance of this project lies in the fact that post is a primary means of communication
for a large part of Indian population as well as a vital component of Indias infrastructure but
very little attention has been given to it. Situation is such that perhaps India along with its
neighbours namely Pakistan and Bangladesh are the only countries wherein postal
department has been so bereft of reforms. Thus in this project we aim to have a look at Indian
postal sector in light of reforms that have been occurring in the postal infrastructure across
the world and try to come up with certain recommendations focusing on making the
department self-financing. The perspective of this project is primarily from that of the DoP.

ULHASNAGAR a small town somewhere in thane district. A PLACE which is nowhere left
behind. A PLACE full of crowd with mostly SINDHI COMMUNITY and other communities
too. A PLACE where doing business is in the BLOOD of people living here.
ULHASNAGAR being called as BUSINESS HUB, divided in five camps , nearby
ambernath and kalyan.

Ulhasnagar, which is once a military camp area for Sindhi refugees migrated from
Pakistan, is now heavily populated with this community people. The city is also known as
Sindhunagar and it is very famous from economic aspect. Ulhasnagar is a very good
business centre not only in Thane district, but also in Maharashtra State. It is a city located on
the coast of West India, which is nearly 60 kilometers northeast of the city of Mumbai.
Birla temple, furniture market, gajanand market, jeans market, Century rayon factory, shiv
mandir etc are the important places in Ulhasnagar.
Brief description:
Ulhasnagar-1 (W): It is also known as Ulhasnagar camp-1 and it is located on the west side
of railway stations. The main center here is a market with famous landmarks like Goal
maindan where many people visit from nearby areas like kalyan, ambernath, badalpur,
dombivili, thane, titvala etc for shopping.

Ulhasnagar-2 (W): The other name of this place is Ulhasnagar Camp-2. It is a market with
popular landmarks like Gajanand market and it is famous for clothing, electrical and
electronics etc. Nehru Chowk is the main centre here.
Ulhasnagar-3 (W): it has another name as Ulhasnagar Camp-3. It is mainly a market and it is
located on the west side of railway stations. The famous landmarks here are furniture bazaar,
RKT College, Sapna theatre, Ashok-Anil Multiplex etc. it is mainly a furniture and
electronics market.

Ulhasnagar 5 (E): This locality, which is also known as Ulhasnagar Camp-5, is located on
the eastern side of railway stations and it is mainly a residential area. You can see several jean
making small scale industries here. Jhulelal Mandir, Swami Sarvanand School, Swami
Shantiprakash Chowk, Nethaji Garden, etc are the famous landmarks here. This locality is
heavily populated with Sindhi community people.

Originally, known as Kalyan Military transit camp (or Kalyan Camp), Ulhasnagar was set up
especially to accommodate 6,000 soldiers and 30,000 others during World War II. Sindhis, in
particular, began life anew in the new land. The area was converted into a township in 1949,
and named Ulhasnagar by the then As said earlier, ULHANAGAR is a place which is
nowhere left behind because each and everything is available here, as it is good in providing

The city has colleges and an industrial-training institute like institute of technology, Holy
family Convent High School, New English (at camp no.5), SST College of Arts and
Commerce etc. Smt. Chandibai Himatmal Mansukhani college and R. K. Talreja are two
major colleges.
Ulhasnagar, one of the busiest business centers in Maharashtra, has several jewellery
showrooms. Some of the popular jewellery showrooms in the city are listed here.
We can watch the gradual development of Ulhasnagar to a shopping hub and business centre
from a military camp area in the pre-independence era only with wonder. Sindhis, who
migrated to this land from Pakistan, has significant role in the growth of Ulhasnagar in the
business field. Even though they came to the city with minimal resources, now most of the
small and big shops in Ulhasnagar are under owned by them. It is nothing else but their hard
work and talent that made them able to develop this city to a mini-Japan during the last five

Ulhasnagar, which is the most popular industrial and commercial township of Thane district,
is famous for shops of wedding costumes, jeans and other readymade garments. Sindhi
people, who live other parts of India such as Gujarat, Goa and Madhya Pradesh, visit
Ulhasnagar to do their wedding purchase. There are many shops, which are exclusively aimed
for wedding costumes

The city is also famous for jeans manufacturing. Jeans and ready made garments
manufactures at Ulhasnagar 5 are sold in all markets of the country. Many popular jeans
brand have factories in Ulhasnagar.

The most busy commercial and shopping center here are Ulhasnagar 2 & 3.

Tourist Attractions in Ulhasnagar:

There are several tourist attractions in Ulhasnagar including beautiful locations, religious
places and historical monuments etc. Some of the famous temples in Ulhasnagar including
Chaliho Sahib, Birla Mandir, haji Malang, Jhulelal Temple, Saint Satram Dham and Swami
Shanti Prakash Temple etc.

Address of Post Office in Ulhasnagar

Finding & Analysis
Q1) Do you have an A/c in Post Office?

Yes No

Post Office A/C










Q2) Which type of A/c do you have?

Saving MIS PPF Recurring

Types of Accounts





10% 11%



Series 1
Q3) Do you visit the post office?

Yes No


91% No
Q4) what is the purpose to visit post office?

Personal Business Both




Personal Business Both

Q5) Which product do you purchase from post office?

Letter Printed post cards Parcel Insurance

Any Other___________









Letter Printed Post Cards Parce

Insurance Other
Q6) Which premium service do you prefer?

Logistic Post Speed Post Business Post Express Parcel

Express Parcel; 10%

Business Post; 13%

Logistic Post
Logistic Post; 44%
Speed Post
Business Post
Express Parcel

Speed Post; 33%

Q7) How often you visit post office?

Daily Weekly Monthly Never





0% 10% 20% 30% 40% 50% 60%

Q8) Are you aware of Core Banking Solutions?

Yes No

Core Banking Solution

59% No
Q9) Are you satisfied with Postal & Non Postal Services?

Yes No

Postal & Non Postal Services

Yes 41%

Q10) Are you satisfied with Interest & Benefits provided by Post office?

Yes No

Interst & Benifts of Post Office





62% 18%





Yes No
Interpertation & Suggesstion

There are a few suggestions which may help to Indian Postal Service Department in its
further growth:

i.- To increase the productivity of the employees, Job Rotation Policy should be
adopted because a similar nature of work makes an employee irritate and less-

ii.- Soft Skill Training is provided to the employees but the implementation should be
done from the Top Level Management because they are the leaders. If a leader will
come late in the office, the follower will also come late.

iii.- Employees are the internal customers of a company. Their satisfaction carries a
greater value. A true & fair feedback system should be their where each employee can
put their words without any fear.

iv.- Employees should be motivated for providing suggestions and if any suggestion is
really valuable, proper attention is required . There should not be any adverse action
against employees at the time of providing suggestion.

v.- A dress code should be there to form uniformity among employees and the colour
of the uniform should be in a light shade because it makes the working environment
cool. (All the colours have their psychological effect.)

vi.- No employee should be allowed to work overtime. Even he should not work after
the duty-hour. Because, the efficiency & effectiveness in the work means completion
of a work within the time limit.

vii.- An attractive infrastructure attracts the customers. Therefore, attention should be

given towards this side.

viii.- Time is precious for every one. With this motto, the customer service
department should work so that there shall not be a long queue in any counter.

It can be concluded, that Indian Postal Service needs technological, social, cultural &
economic change. With a little bit of change, it can create a monopoly in the market.

But Indian postal services is only one central government services for Indian peoples as well
as post card , postal stamp KVP , NSC ,MIS and other some product which is best campier to
other private company like Postal life insurance .

Lastly conclusion is a - - - - - - - -

India is a beautiful so our Post Office