India Post Payments Bank to start operations in August with 650 branches: RBI
Date: July 30, 2018
The India Post Payments Bank(IPPB) has been cleared by the Reserve Bank of India(RBI) for operations. The IPPB is forecast to start with close to 17 crore accounts and 650 branches across the country.
What is the India Post Payments Bank?
The IPPB attempts to provide last mile inclusion into the financial system of the most remote parts of the country. The bank will be governed by the RBI and has full government equity. The bank will offer demand deposits like savings and current accounts with a balance of a maximum of 1 lakh rupees. The bank will provide electronic payments and remittance services and third party services such as insurance and mutual funds. The CEO of the corporation is Suresh Sethi, who will also serve as the MD.
When is India Post Payments Bank going to launch?
The IPPB already has two operational branches, and 648 planned branches. Services at these branches will commence from August 21, 2018 which is the scheduled launch date.
Why is India Post Payments Bank called a payments bank?
Payments bank is a new model that was recently introduced by the RBI. Under the restricted rules, accounts cannot hold more than 1 lakh rupees and can not issue loans or credit cards. The IPPB is only the third bank to receive the payments bank license. The other two are the Paytm Payments bank and the Airtel Payments bank. The payments bank model was devised to help mobile companies and supermarket chains make payments easier for their customers.
Future plans of IPPB:
The plan of the IPPB is to eventually link about 1.55 lakh post offices to provide last mile services. The bank already has permissions for NEFT, RTGS and IMPS transactions. This will enable customers to send and receive money from any other bank. A mobile app has been devised but customers will only be able to access the full range of services later.
Some Amazing Facts:
- Bharti Airtel was the first to set up India’s first live payments bank.
- There are nine other entities that have an in-principle license for a payments bank, besides IPPB.