Prime Minister Narendra Modi will launch India Post Payments Bank on August 21. (File)
Minister of State for Communications Manoj Sinha on Wednesday said that Prime Minister Narendra Modi will launch India Post Payments Bank (IPPB) on August 21 to provide financial services to people in underserved areas.
"The Department of Posts reaches every nook and corner of the country including rural and remote areas. With the upcoming nation-wide launch of IPPB, the trusted postman will now become a banker to millions of unbanked and under-banked Indians who have so far had no access to financial services," Mr Sinha told reporters in New Delhi.
It will leverage the vast network of the Department of Posts (DoP), which has more than three lakh employees and 1.55 lakh post offices, to turn into access points for the new payments banks. Its reach will be further strengthened by grameen dak sevaks.
"Of the 1.55 lakh post offices, 1.30 lakh are in rural areas and with the transformation of all post offices into payments banks by December, the number of bank branches in rural areas would more than double from 49,000 to 1.30 lakh," the Minister said.
The postal bank will offer savings and current accounts, money transfer, direct benefit transfers, bill and utility payments, and enterprise and merchant payments.
The Postal Department already has 37 crore accounts across the country including 17 crore postal savings bank accounts. These accounts would be linked with the IPPB and all services provided by IPPB would be available to existing DoP customers.
The IPPB accounts, which will give four per cent interest rate, will not hold savings of more than Rs one lakh. Any money above that limit would automatically be transferred to the old post office accounts with which the IPPB accounts will be linked.
"IPPB will also offer services including credit, insurance and mutual funds by leveraging its tie-ups with third parties like Bajaj Allianz for life insurance and Punjab National Bank for loans," DoP Secretary A N Nanda informed.
The products and services will be offered across multiple channels such as counter services, micro-ATM, mobile banking app, SMS and IVR. On the day of launch, IPPB will have 650 branches at district level and 3,250 access points across the country, Mr Nanda said.
India Post MD and CEO Suresh Sethi said that the aim is financial inclusion and the key objective is financial literacy with prime focus on ease of banking.
"We are bringing the simplest form of banking which will be paperless. A QR card will be given to the villagers which along with biometric verification will enable them for all the financial services. The doorstep services will come at a nominal cost," Mr Sethi said.