Post Bank of Iran has signed an agreement with several state entities to promote the indigenization of technologies of banking and postal services in the country’s less developed areas with the help of the growing tech ecosystem.
Behzad Shiri, the head of PBI, entered into a deal with senior officials from the Vice Presidential Office for Science and Technology, its subsidiary Iran National Innovation Fund, Iran Telecommunications Company and Iran Telecommunications Organization, affiliated with ICT Ministry, last week, Isti.ir reported.
As per the deal, all the engaged entities are committed to help PBI boost the speed and cost efficiency of services, upgrade online databases, optimize its systems’ maintenance and curb its reliance on foreign partners.
“This is a five-year contract, based on which, ITC and ITO agreed to fulfill the Post Bank’s communication requirements. The vice presidential office also committed to introduce ICT startups and tech teams with smart solutions for upgrading the bank’s services,” Shiri said.
According to the official, PBI has established over 6,000 rural branches and is making efforts to further expand its services in collaboration with state and private tech units.
“PBI centers in villages offer services to over 2.7 million clients. The injection of new technologies into the field can save time and energy both for the staff and customers,” he said.
During the event, PBI also signed a five-year agreement with Iran's Municipalities and Village Administrators Organization, affiliated with the Ministry of Roads and Urban Development.
Based on the deal, Post Bank agreed to offer loans and financial discounts for village administrators for expanding rural welfare.
PBI is expected to boost the quality of its services and expand its presence in rural and underdeveloped areas.
The bank is committed to provide administrators with financial aid packages for purchasing agricultural and industrial machinery, installing automatic teller machines, establishing post offices, implementing sustainable projects and creating jobs.
Digital Economy
Last year, former ICT minister, Mohammad Javad Azari Jahromi, urged Post Bank of Iran’s managers to put greater focus on promoting smart banking and digital economy by involving fintechs and startups.
Jahromi said PBI is expected to further strengthen the role of ICT and incorporate smart banking mechanisms in its operations.
He emphasized that the bank should accelerate its progress by giving more opportunities to tech units and knowledge-based companies for buttressing their electronic banking operations.
“The share of tech-based firms in the domestic economy is increasing day by day. Banks, including PBI, should get involved and use this as an opportunity," he added.
Since its inception in 1996, the state-run PBI has been working on expansion of financial and banking services in rural areas. The bank operates under the ICT Ministry.
The bank's operation mostly comprises micro financial services based on ICT platforms.
With over 10,000 rural branches, PBI has the largest network in the country, which covers even remote areas.
In 2019, PBI launched several new branches in the rural areas of Ilam and Lorestan provinces.
According to Fardin Amiri, the bank’s provincial chief, PBI managed to offer a major part of financial and banking services online.
The number of transactions recorded only in Ilam exceeds eight million per month. PBI's services have curbed millions of unnecessary trips from villages to city centers for carrying out banking operations, he added.
Besides, Lorestan has become a large market, as 23 new PBI branches became operational in Nourabad, Doroud, Kouhdasht, Boroujerd, Poldokhtar, Khorramabad, Aligoudarz and Aleshtar counties in 2019.
Experts say work is still on track to add equipment to an additional seven branches that will start offering services in the near future.
Fintech Startups
With the growing number of branches, PBI requires more technological ideas and startups to ensure it remains innovative and high-tech in terms of service quality and efficiency.
Unofficial reports show about 50 fintech startups are operating in Iran’s financial markets.
Lack of a regulatory body and a proper legal framework are considered Iranian fintechs' main drawbacks.
The Central Bank of Iran had earlier announced that it was working on a comprehensive rulebook to authorize the operation of fintechs in the country.
To identify and empower potential talents and innovative ideas in the field, numerous startup weekends have been organized nationwide.
One such event was the Nourbakhsh Award ceremony held on the sidelines of the Eighth Conference on Electronic Banking and Payment Systems in February 2019, organized by the Monetary and Banking Research Institute.
The annual event, which honors innovators in electronic banking fields, is the most prestigious of its kind with winners usually receiving their awards from the governor of the Central Bank of Iran.
