PM Modi to Launch India Post Payments Bank on September 1
PM Narendra Modi will launch India Post Payments Bank (IPPB) on September 1, 2018. The Post Office will become the country’s largest banking network with 1.55 lakh post office branches, as well as focus on providing banking and financial services to the people in rural areas. India Post Payments Bank Earlier it was started by Prime Minister Narendra Modi on August 21. But due to the announcement of a seven-day national mourning on the demise of former Prime Minister Atal Bihari Vajpayee, the program had to be changed.
What is a Payments bank?
A Payment bank is like special types of banks which are allowed to have limited banking activities in comparison to the real bank, such as these banks can collect money from customers but cannot afford the loan i.e. the payment bank will not be the whole bank but the general public and provide financial services to almost all the poor people or villagers. Through this, a customer will be able to make a maximum transaction of one lakh rupees in the beginning and offer remittance services, mobile payments/transfers/purchases and other banking services like ATM/debit cards, net banking, and third-party fund transfers. It will issue an ATM and debit card but they will not be allowed to issue a credit card. In order to open such a bank, capital of 100 crores is necessary for the first five years.
The objectives of setting up of payments banks are to increase financial inclusion by providing small savings accounts and payments/remittance services to migrant laborers, low-income households, small businesses and other unorganized sector entities.
There are 10 things to know about India Post Payments Bank:
1) Suresh Sethi, CEO of India Post Payments Bank had earlier said that India Post Payment Bank will be live with 650 branches in addition to 3,250 access points. About 11,000 postmen will provide doorstep banking services in rural and urban areas.
2) By the end of this year, Government is trying to add all the 1.55 lakh post office branches with India Post Payment Bank services. This system will be the largest banking network in the country with the direct presence at Village level.
3) India Post Payments Bank has been allowed to link 17 million Postal Savings Bank (PSB) accounts with its accounts.
4) People in rural areas will be able to take advantage of Digital Banking and financial services including Money Transfer, to any bank account either with the help of mobile app or by visiting the post office.
5) Payments Bank has permitted to carry RTGS, NEFT and IMPS transactions that will enable its customers to transfer and receive money from any bank account.
6) With the third party tie-ups, account holders in the IPPB will be able to take advantage of financial services such as in the case of a Regular Banking Customer.
7) India Post Payments Bank has been set up under the Department of Posts, Ministry of Communications, with 100% equity owned by the Government of India. Earlier it started set-ups on 30th January 2017 with two pilot branches, one at Raipur and the other at Ranchi.
8) Payment banks can accept deposits of up to Rs. 1 lakh per account at the beginning from individuals and small businesses.
9) India Post Payment Bank will be used by the government to distribute NREGA wages, subsidies, pension etc.
10) India Post Payment Bank app which is expected to be launched on the same day, customers will be able to avail of more than 100 services, including Phone Recharge and Bill, Electricity Bill, DTH service, College fee, etc. that are present on Bharat Bill payments system (BHIM) of National Payments Corporation of India.