Money is an interesting thing. Everything happens with it.
Let’s take, for example, a place like Jamshedpur. I use an ATM. I get my money.
I go to a Post Office to collect the interest I accured. I get my money. I work
in electricity department. My department cashier gives me my salary. But, there
is one major catch here. Money is not printed in Warangal. The nearest centres
where it is printed are Nasik and Dewas, both, almost thousand kilometres away.
So, how does the money come here? Well, the concept is simple. The stuff is
first insured and then it is transported under armed escort. From there, it is
distributed all over the bank network in India in the same fashion. If it is,
say, State Bank of India. Using the network, it reaches nearest handling
station, say, Kolkata. From there, based on need, the money is moved to Jamshedpur.
Note that, theoretically, Jamshedpur will have sufficient cash to go on. This
is a rare case where money is to be brought into Jamshedpur. The real point of
the discussion is not that. Money has reached bank in a watertight process. All
is well. How is the money transferred from the bank to the nearest post office
or from the nearest post office to the bank.
In India, banks are not responsible for delivery of cash to
the customer. The customer, whomsoever he is, withdraws the cash and then takes
it to the destination at his own risk. This can be a private individual or a
government entity. Any issues during transfer, the withdrawer is responsible
and none else. If it is a government entity, there is a prescribed maximum a
person can carry. Anything above that should be under an armed escort only.
Let’s assume, the number is 1 lakh. It means that anything above a lakh should
be transferred using an armed escort only. And armed escort costs. Now, this is
the situation. In a post office of the size of Jamshedpur Head Post Office with
daily turnover of around above a crore, are we saying that the department
should consider armed escort daily, both to take the cash in the morning and
deposit it in the evening, if it is more than the permissible limit to be held
in the office itself? Assuming one trip costs 5000, an additional income of 3
lakh per month is what the post office will have to spend to bring the money
from the bank. That is not the end of the story. Now, the money should be
transferred to other smaller post offices. This money is to be transferred by
the department internally and this, again, needs escort. Now, look at this
paradoxical situation. A person brings in 5 lakhs to a single employee Branch
Post Office to deposit. He will have to deposit the money in the bank. He can’t
carry more than a lakh. He can’t keep the office closed with 4 lakhs inside to
deposit it in batches of a lakh because 4 lakhs is way above the permissible
limit. If he asks for an armed escort, all approvals and everything, by the
time the escort comes, either the bank is closed or he misses the last bus. How
are we supposed to handle this situation? 3 lakhs just for Jamshedpur Post
Office and 5 lakhs per months for Jamshedpur HO zone is not a small number to
think about.
For a change, let’s talk about Toyota Lean Technology. In
layman’s terms,
Profit = Selling Price – Cost Price
If I increase selling price, I will be booted out of the
market. So, to ensure I stay in market and to increase my profits, the only
option available for me is to reduce the cost price. How do I do that? By
reducing in transit costs and by recycling waste and then, I will reduce the
salaries of the workforce(meaning I will reduce the team strength/I will use
workforce having lesser salaries) – meaning I will reduce the quality of the
work. All of this points to a single thing – cutting down unnecessary
expenditure.
For senior management sitting in glass cubicles, to increase
their revenue margin, one of the godsend opportunities is to cut down the cost
of armed escort. After all, no incidents happened till now; going by that,
nothing will happen even without escort. The Post Master whose neck is on the
noose is the real scapegoat, holding his job and the life of the person
transferring the money at stake. After all, the managers have got nothing to
lose. For a zonal head handling 30 such Post Offices, 1.5 crore is a big money
to save. But if something happens?
The paradox is this. 5 lakhs is a big money. It doesn’t make
any sense if I increase the unescorted ceiling to 5 lakhs or 10 – the risk is
still there. Neither can I have an escort daily – it’s unnecessary drain of
money. Postal department handles money, this is fine to some extent. But, the
real question arises when we talk about departments like electricity or water –
they handle money only for two or three days a month. And, they don’t have any
clue how to handle that money.
To come out of this mess, I can think of two possible
solutions.
One. Let the banks handle the transfer to the first point of
outfeed or infeed and let there be an annual budgetary allocation for this.
After all, they are well versed security protocols than post offices or
Electricity Board Offices. That will simplify the supply model because the
police will get requests from a single source. This, again, raises problems
with sub offices. Postal department will have to transfer the cash between it’s
offices. It can’t outsource it to the banks. Or can it? Instead of Postal
Department doing the money transfer between the sub offices, let the banks do
it. Let there be a specific time when the bank personnel will come and collect
the cash. This will sort out the problem considerably regarding handling the
money.
Two. Instead of asking for armed escort daily, let there be
a budgetary allocation. Police department should provide armed escort to whomsoever
who subscribed and fulfil the needs. Will there be an over exertion of the
department, will there be a diversion of the primary chore of the department
from fighting crime to guard duties, no one can tell. To make the life much
easier, a separate sub-department can be carved out of police department for
the purpose of armed escort alone, externally funded.
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