PM Narendra Modi's banking masterstroke: Will India Post Payments Bank prove to be a game changer?
Given the scale and reach it is opening with, the IPPB may become a game changer especially in the field of rural banking services.
Prime Minister Narendra Modi will be launching India Post Payments Bank (IPPB) on September 1. The IPPB has been termed as a game changer by Telecom Minister Manoj Sinha, who had inaugurated the operations of two branches, at Raipur and Ranchi, on the pilot basis in January this year. Sinha had said that the government is working to provide financial services through all of 1.55 lakh post offices to fulfil the PM's vision of financial inclusion.
But will it really be a game changer? Maybe. Given the scale and reach it is opening with, the IPPB may become a game changer especially in the field of rural banking services.
Here are the key facts and features of the IPPB:
* IPPB has been envisioned as an accessible, affordable and trusted bank for the common man, to help speedily achieve the financial inclusion objectives of the Union Government.
* It will leverage the vast network of the Department of Posts, which covers every corner of the country with more than 3,00,000 Postmen and Grameen Dak Sewaks.
* Given the vast reach of the postal department, IPPB will significantly augment the reach of the banking sector in India.
* IPPB will have 650 branches and 3,250 access points spread across the country from the day one.
* All the 1.55 lakh Post Offices in the country will be linked to the IPPB system by December 31, 2018.
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* IPPB will offer a range of products such as current and savings accounts up to a balance of Rs 1 lakh, money transfer, direct benefit transfers, social security payments, bill and utility payments, distribution of insurance, mutual funds, pension products and acting as business correspondent to other banks for credit products especially in rural areas and among the underserved segments of the society.
* These products, and related services, will be offered across multiple channels (counter services, micro-ATM, mobile banking app, SMS and IVR), using the bank’s state-of-the-art technology platform.
* The IPPB is being set up us a 100% Government of India owned Public Limited Company under the Department of Posts
* All 1.55 lakh post offices including the 1.39 lakh of the rural post offices will be mapped to the IPPB branch at the district headquarter and function as access points for IPPB.
* To enable doorstep banking, IPPB will be delivering services through postmen and Grameen Dak sevaks, savings agents and other franchisees.
The Reserve Bank of India gave ‘in principle’ approval to the IPPB on 19th Aug 2015. It received cabinet’s approval on 1st June, 2016 and final approval from the RBI on 20th Jan 2017.
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