A Payment Bank (PB) facilitates small payment transactions of its retail customers. It operates on a small scale. Though a majority of banking transactions fall under its purview, yet it can not give any types of loans. As credit cards fall in the category of loans, it can not directly issue credit cards either. On deposit side also it works on low level restricting customer deposits to Rs. 1 lac. However, the benefit here is that any amount over and above can be transferred to the Postal Savings Account of the customer. The country has over 17 cr postal savings accounts.
Some other examples of the payment banks are Airtel Payment Bank and Paytm Payments Bank. The government last week infused Rs. 1435 cr additionally to make it compatible with other banks.
India Post Payment Bank (IPPB) is one such bank. It was opened for the public by the prime minister on the 1st of September, 2018 with 650 branches. As a matter of fact, by branch network parameter, it is the largest bank in the country as each of the 1.55 lac post offices in the nation now becomes a branch of this bank by end of this year. Majority of such branches will be in semi urban and rural areas. Its 3 lac postmen are being trained in the banking services. They are being equipped with smart phones and biometric readers.
Products Offered by IPPB: CASA (Current Account / Savings Account), ATM Facility, Utility Bill Payment, Money Transfer, Direct Benefit Transfer and Merchant Payments etc. Savings Account will offer 4% interest rate. Bill and Merchant Payments will be through QR card. Ahead of its launch, IPPB has enrolled over 4 lac customers.
The channels for customer service will be: Over the Counter Services, Services through ATM, Mobile Banking and IVR (Interactive Voice Response).
IPPB will work as an agent of Punjab National Bank (PNB) for third party products (TPP). Life Insurance tie up of IPPB is with PNB Metlife and General Insurance is through Bajaj Allianz.
