PERSONAL FINANCE
A good amount of money is there to be made with an investment of just Rs 5,000 with the Post Office franchise scheme.
The Post Office offers several schemes for Indian citizens looking to earn good returns on their hard-earned savings. While such investment schemes are highly popular among people, do you know that the Post Office also offers the opportunity to start your own business by establishing a new franchise. With a nominal investment, one can open a Post Office franchise and earn decent income through the several commissions offered.
Franchise opportunities offered by post office
A good amount of money is there to be made with an investment of just Rs 5,000 with the Post Office franchise scheme. Despite the 1.56 lakh post office branches spread all over India, there is still demand for new outlets. Due to this need, two types of franchise models are offered by the post office – Franchise outlets and Postal Agents.
Franchise outlets can be opened to offer counter services where there is need but a branch cannot be established. On the other hand, individuals can also become postal agents who sell postal stamps and stationery in both urban and rural localities.
Eligibility for taking a post office franchise
There are certain parameters to determine if a person is eligible to start a post office franchise:
There are certain conditions for ineligibility like family members of postal employees who are in service cannot avail the franchise scheme. On the other hand, individuals or variety of organisations and entities can take up the scheme. This includes corner shops, paanwalas, kiranawalas, stationery shops, small shopkeepers, etc. in urban and rural areas and new upcoming urban townships, special economic zones, major highway projects, upcoming new industrial centres, colleges, polytechnics, universities, professional colleges etc., as per India Post.
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Earnings with Post Office franchise scheme
With a post office franchise business, individuals can earn good returns through commission which is fixed for different services as below:
- For booking registered articles, a commission of Rs 3 per transaction is set.
- For booking speed post articles, the commission per transaction is Rs 5
- For money orders, Rs 3.50 commission will be earned on bookings of money order between Rs 100 and Rs 200 while a money order above Rs 200 will bring Rs 5 commission per transaction. Franchise agents will not book money orders less than Rs 100.
- Achieving a monthly target of 1000 registered and Speed Post bookings will bring additional commission of 20%.
- On sale of postage stamps and stationery, the commission is set at 5% of the sale amount.
- For retail services including sale of revenue stamps, central recruitment fee stamps etc., commission is set at 40% of the earnings made by the Department of Post. This amount will be rounded off in rupees to be at 40% or less.
- Finally, on monthly business from registered parcel and speed post parcel, separately, following commissions are set.
Monthly business amount |
Speed post parcel |
Registered parcel |
Up to Rs 5,00,000 |
10% |
7% |
Rs 5,00,001 to Rs 25,00,000 |
15% |
10% |
Rs 25,00,000 to Rs 1,00,00,000 |
20% |
13% |
Rs 1,00,00,000 to Rs 5,00,00,000 |
25% |
16% |
Above Rs 5,00,00,000 |
30% |
20% |
Applying for Post Office franchise scheme
To apply for the franchise scheme with post office, individuals will have to follow certain steps:
- An application form for franchise needs to be filled including a business plan describing activities that will be undertaken at the outlet and submitted.
- This application form can be obtained from the post office. Submission is required to also include copies of detailed proposals. This form is also available for download from the Department of Post official website.
- The postal department and the franchise applicant will sign a Memorandum of Agreement (MoA)
- The selection will be finalised by respective Divisional Heads. This will take up to 14 days from the date on which the application form was submitted.
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