India Post Will Convert 1.5 Lakh Post Offices Into Payments Bank Outlets
India Post Payments Bank was launched in January earlier this year
India Post Payments Bank or IPPB, which was launched in January this year, is aiming for a massive outreach program to make banking services even more accessible and transparent.
In a major announcement, India Post has announced that they will transform each and every 1.55 lakh post offices into payments bank outlet; and every postman and grameen dak sevak, which are 3 lakh in number, into representatives of their bank.
This way, India Post Payments Bank will become India’s second largest Payments Bank in terms of reach. With 15 lakh outlets, and 2.5 lakh merchants, Airtel is India’s largest payments bank network. Airtel had launched their services in November last year.
Note here, that India Post has already announced that they will start offering ATM services via their Payments Bank network. Once this massive project is executed, India Post will become world’s largest ATM network.
India Post Payments Bank Is Now Spreading
The core mission of India Post Payments Bank is to provide affordable banking services to the lowest rung on the economic ladder, and the beginning is superb to say the least.
During an event by United Nations on Financial Inclusion, India Post Payments Bank (IPPB) chief executive officer AP Singh said, “While our private sector counterparts will, I take it very positively, skim the market from the top, you need someone who works bottoms up. That is our choice.”
Highlighting their future program to increase their reach within villages and towns, Singh said that by March 2018, 3 lakh+ postman and grameen dak sevak will be equipped with hand-held device, which can perform all banking activities allowed under their Payments Bank.
Besides, every one of the 1.55 lakh post offices would converted into banking outlets.
Aadhaar Based Banking = Low Cost Banking
India Post also announced that a new Aadhaar based banking would be initiated, in which a person’s Aadhaar number would be the payment address.
This way, need for physical address and verifications are removed. And the best part: Aadhaar will bring down per transaction cost to less than 1 paisa.
Singh said, “We have taken up the challenge on ourselves as to how we make a Rs 10 transaction viable. Aadhaar authentication cost less than 1 paisa. There is no reason why a payment transaction should be transacting anything more,”
Right now, India Post Payments Bank offers an interest rate of 4.5% on deposits up to Rs 25,000; 5% on Rs 25,000-50,000 & 5.5% on Rs 50,000-1,00,000.
They can accept deposits up to Rs 1 lakh, per individual and business account.
Via their post offices and postman, various remittance services would be also offered, along with access to 3rd party financial services like insurance, mutual funds, pension.