India Post Payments Bank to launch on Sept 1

India Post will start its long-awaited payments bank by launching 650 branches across the country, making it the fourth such entity to start operations, three years after the Reserve Bank of India gave its in-principle approval for the new kind of banks. 

by Prashant Kapadia/NHN

From September 1 the postman will help you open a bank account as India Post Payments Bank (IPPB) launches operations across India.The post office’s IPPB will provide customers savings and current accounts, along with services including bills and utility payments, remittance and money transfer, direct benefit transfers and enterprise and merchant payments. It will incorporate net banking and mobile banking facilities as well. IPPB has also tied up with Bajaj Allianz Life Insurance to offer life insurance products and PNB Met Life for Pradhan Mantri Jeevan Jyoti Bima Yojana.

Nearly four lakh zero-balance savings accounts have already been opened across the country, with 20,690 from Maharashtra alone. Current accounts require a minimum balance of Rs 1,000 at any point in time. The interest rate to be offered on deposits is 4 percent. “All customers will also be given a QR code card, different from a debit or credit card, and will be used for making payments by scanning the QR code in it and authenticating their biometric. Hence this card cannot be even misused if it is lost,” said HC Agrawal, Chief postmaster General, Maharashtra Circle at India Post. Accounts will be opened with the help of Aadhaar and PAN card numbers digitally. In the first phase, 650 branches will be opened along with and 3,250 access points across the country.

In Maharashtra, IPPB will be launched at 42 branches and 168 access points. It targets to have 12,831 counters at its bank branches by December end across India. Agrawal added, “We aim to reach one branch per district and we have trained all postmen to handle and use the digital devices (biometric device and a mobile phone) taking them to the customers at their doorstep. As of now 804 postmen will be handling the device and we will increase the number gradually.” This comes nearly three years after the Department of Posts, one of the 11 entities, got the in-principle nod from Reserve Bank of India (RBI) in 2015 to set up a payments bank.

IPPB has already missed the 18-month deadline in September 2017 to open 650 branches across the country, primarily because it failed to get a system integrator (SI) on board on time, upsetting its payments bank schedule.Overall 11 entities were issued a licence including Airtel, Paytm, Fino and Aditya Birla Idea Payments Bank, who have launched services. Three firms, gave up their and didn’t venture into the sector. IPPB has been incorporated as a public limited company under the Department of Posts with 100 percent government equity. Currently, India Post has a network of 1.55 lakh post offices across the country with over three lakh postmen and Gramin Dak Sevaks (GDS) offering assisted doorstep banking in rural, urban and remote areas.