Prime Minister Narendra Modi launched the initial phase of India Post Payments Bank (IPPB) on Saturday. The payments bank has now become operational at 3,250 access points in 650 districts across the nation. IPPB will reach rural and far-flung areas of the country, delivering banking services to the doorstep of every Indian, said PM Modi while launching the initiative.
"The India Post Payments Bank branches have been opened in 650 districts of the country. The postman who used to deliver letters has now become a mobile bank too," Modi said.
The IPPB will be looking to utilise the extensive network of its parent organisation India Post to become the largest banking service provider in the country. The payments bank will be supported by the extensive network of post offices and almost three lakh postmen and Grameen Dak Sewaks across the country.
IPPB, like other payments banks, will operate on a smaller scale without involving any credit risks. It will accept deposits of up to Rs 1 lakh, offer remittance services, mobile payments, transfers or purchases, along with other banking services like ATM and debit cards, net banking, and third-party fund transfers. The IPPB will offer products and services though multiple channels such as counter services, micro ATMs, mobile banking app, messages and interactive voice response.
The IPPB will offer 4 per cent interest rate on savings accounts. IPPB has teamed up with financial services providers like Punjab National Bank and Bajaj Allianz Life Insurance for third-party products like loans and insurance.
The service will be rolled out for 1.55 lakh post offices across India by the end of this year. Among these, 1.30 lakh access points will be located in rural areas to tap the market potential of this largely unexplored part of India. IPPB also has permission to link around 17 crore postal savings bank (PSB) accounts with its own set up.
IPPB will leverage tech platforms to offer door-to-door banking services. It will use Aadhaar to open accounts, while a QR card and biometrics will drive authentication, transactions, and payments. Grameen Dak Sewaks and postmen will be armed with smartphones and biometric devices to handle transactions.
The Cabinet, earlier this week, approved an 80 per cent hike in spending on IPPB to Rs 1,435 crore - arming it with additional ammo to compete in the market with existing operators like Airtel Payments Bank and Paytm Payments Bank.
Edited by Vivek Punj with PTI inputs