India Post Payments Bank to increase rural banking infrastructure by 2.5 times

Making a major comeback in the financial arena, India Post Payments Bank has enabled over 1,35,000 Banking Access Points, out of which 1,10,000 are in rural areas, thereby increasing the rural banking infrastructure by 2.5 times, said a data by the Ministry of Communications, Law & Justice and Electronics and Information Technology.

 

Launched across the country on September 1, 2018, India Post Payments Bank has been incorporated as a Public Limited Company with 100 percent Government of India (GOI) equity on 17.08.2016, under Department of Posts, Ministry of Communications.

As quoted by the ministry in Lok Sabha, over 2,00,000 Doorstep Banking Service Providers (Postmen and Gramin Dak Sevaks) have been trained and certified to provide a comprehensive suite of banking services including completely paperless and instant Account Opening, Cash Deposits/ Withdrawal, Money transfers, Bill Payments and Government to Citizen (G2C) Payments.

The benefits provided by India Post Payments are:

As per the approved plan 650 IPPB branches (almost one in each district) have been set up and functional across all the States and Union Territories.

IPPB is focused towards building a less cash and digital economy and enabling digital financial inclusion at the last mile. With these objectives, IPPB has enabled approximately 200,000 doorstep banking service providers with micro-ATM devices (Smartphone and biometric device) to provide a full suite of banking services (including Cash Deposits/ Withdrawal, Account Opening, Money transfers, Bill Payments and DBT distribution) at the customer’s doorstep. Therefore, IPPB has not invested in physical ATMs.

Further considering low penetration of ATMs in rural India, IPPB has established linkages with all the interoperable Payment and Settlement Systems (UPI, IMPS, NEFT etc.) to enable digital transactions and hence has not issued any Debit Cards.

IPPB is in early stages of discussion with various global & domestic institutions to enhance its product suite, as per the Payment Bank guidelines governing third party products.

Source: Lok Sabha

Reserve Bank of India’s Agenda on Rural Banking

With the rising empirical evidence on the prospective development benefits from financial inclusion, the Reserve Bank’s agenda pertaining to rural banking has shown a visible growth. The apex bank’s initial focus, as mentioned in Report on trend and progress of banking in India 2017-18, is now on provision of credit and making available savings avenues to a larger remit of diverse services.

It is also taking steps to strengthen existing schemes, namely business correspondents and lead bank scheme, so that they leverage on digital financial services in financial education and management of financial risks.

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