About the Department

The Post Office Savings Bank is an agency function performed by the Department of Posts on behalf of the Ministry of Finance (DEA), Government of India. Promotion of business in small savings was mainly the concern of the National Savings Institute, Government of India, headquartered at Nagpur. But recently the burden of mobilization is being increasingly shouldered by the respective State Governments. The rules of the Savings Schemes are framed by the Ministry of Finance, Government of India in consultation with the National Savings Commissioner and Department of Posts. The National Savings collections invested in the NSS become available resources for development to the Central and State Governments. 100% of the net collections in a year in the States become available as loans to the respective State Government. The State Government, therefore, take keen and active interest and work jointly with the National Savings Institute for the promotion of the movement, as also of the savings schemes.

Many State Governments have set up their own small savings organisation with small Savings Directorate at State Head Quarters and offices at lower formations.

In Kerala there is a separate Department for the promotion of National Savings named Directorate of National Savings under the administrative control of the State Finance Department.

Objectives

In the beginning the object of the Post Office Savings Bank was to encourage the habit of thrift among the common man but this concept has undergone a radical change during the last three decades. From the restrictive objective of providing a facility to the public to deposit their small savings, the post office savings bank has become a medium to mobilizing large resources running into hundreds of crores every year for plan projects. As a result of the change in the role, the expectations of the performance of the POSB have gone up very much both in the minds of those concerned with small savings and the general public. It has also been established that approximately 30% of the total collections on small savings in the country are drawn from the rural population. It shows how well and deeply the POSB has penetrated the farthest and the isolated villages of India. The POSB is now a major instrument available to the government for mopping up savings both in rural and urban areas.

National Savings Directorate is the State Government Department, which is mainly engaged in the popularization of various small savings schemes. As the Central government releases the whole net collection to the State Government as long-term loan Kerala Government is making every effort to mobilise sizable savings with the participation of Government departments, local bodies, statutory boards, voluntary organizations, school sanchayika, Payroll savings groups and authorized agency forces like SAS, MPKBY and PPF.
The main objectives of National Savings Department are:

1. Popularization of schemes under POSB.
2. To inculcate the habit of savings among public especially among the rural population.
3. Appoint agents under MPKBY, SAS and PPF and create self-employment opportunities among educated youth of Kerala.
4. Implement the development schemes introduced by the State Government every year utilizing    the funds of National Savings.State Government periodically declares lucky prize schemes and special cash incentives to investors. Special schemes with public participation were periodically launched and the money so mobilized was used for the overall developmental activities of the State.