I & my daughter went to post Rakhis for our family. The post office is a bit far, but we have a post box hanging on a Neem tree near our house. I was surprised that it was full with “Rakhi Packets”, to the extent that I could pull out a few if I insert my fingers. My daughter was amazed & she remarked… “Dad.. this looks like a good business. Who owns this company post office?” Back of my mind, I was thinking, how this century-old department is reinventing itself and on verge of becoming the biggest payment bank of India – The India Post Payments Bank… starts 1 Sept 2018.
The Indian Post Payments Bank (IPPB) is a new player (or I should call it a veteran) in the financial market. It looks easy but it takes many years of hard work & millions to keep alive a dying business. It goes live with 650 Branches and 3500 access points located in post offices on 1 Sept 2018.
India Post Payment Bank took a lot of time but I really hope it bridges the gap we have in India & Bharat. In fact, I cannot think of a better name to accomplish this task.
Do you know, after Jandhan, Jio & Paytm etc … all kind of exercise we still have more than 20 crore heads – With NO BANK ACCOUNTS!
Call it nostalgia… my nature to adore old & rich, I really want it to succeed and flourish. Same reason I had written about Post Office Savings Bank a few days ago. Now a bit of information on India Post Payments Bank.
First, a clarity… your post office is not changing to a bank immediately. It’s a separate entity and maybe later they merge or do business together.
Biggest Weapon of Asset India Post Payments Bank
Door Step Banking – Yes, the department has 3 Lakh people on fleet. Ask your bank, they too have door stop banking, but for really large clients only.
Do you have access to a door banking facility with your current bank? And here we have a player which specializes in it.
What if you get services at your door… no matter where you are or live. This is what Indian Post Payments Bank is banking upon.
Question: What do you need to make a successful bank?
Answer: People, Real Estate, Money Supply & Technology.
Post Office already has people and has inducted more, they have a more than 5 lakhs crore deposits, they have 1.5 lakhs branches and now a CBS system (Centralised Banking System).
Do you know RBI has stopped Paytm & Fino Payments Bank to stop opening new accounts as they were not able to verify a large number of KYC of new accounts due to technology, access, and other issues?
IPPB will provide handheld devices to its staff and aims to use Aadhaar based identification to onboard customers. This is similar to what telecom players are using.
The reach is so huge that government is planning to shift all NAREGA accounts once it gets fully operational.
IPPB Business Proposition
India Post Payments Bank or IPPB will have 650 Branches to start with and 3500 employees. Majority of this infrastructure is already in place. Further, IPPB will deal through:
- Counter operations
- ATMs/micro ATMs
- Doorstep, mobile and internet banking
- Transfers like RTGS, NEFT & IMPS
- Pre-paid instruments such as mobile wallets, PoS, MPoS, etc.
- Third party products like MFs, Insurance, Pensions & Forex.
- Coming with an app to make mobile recharges, utility bills and other payments like school fees etc.
- Small-scale loans
Can you link Post Office Savings Bank A/c to IPPB A/c?
The payments bank is all determined to bring the regular Post Office Savings Bank accounts into the fold of digital transactions.
As the limit of Payments bank is 1 Lakh, the excess amount can be linked and transferred to Post Office Savings Bank account at the end of the day! Just like Sweep In-Sweep Out account.
Currently, you can open a IPPB account with the commitment of no minimum balance and earn 4% interest on it.
In all, a revolution starts when PM inaugurates the Post Office Payments Bank on Sept 1, 2018.
I will be eager how this entity emerges and do business.
Do write what you think or if you want to ask any question, in the comments section below.
