The Reserve Bank of India (RBI) has given its approval to India Post to start its Payments Bank services. The new entity is named as India Post Payments Bank (IPPB), which is expected to start operations by March 31. IPPB has been incorporated as a public limited company under the department of posts with 100% equity from the government. IPPB is the third entity in India to get license for starting Payments Bank services. Earlier, such license was given to Airtel and Paytm. IPPB will gradually start offering Payments Bank services across 650 districts that include a network of 1.54 lakh post offices.
A P Singh has been appointed as the interim managing director and CEO of IPPB. Singh is a 1986 batch Indian Postal Service Officer and had earlier held the post of Joint Secretary in the Department of Investment and Public Asset Management (DIPAM). He was also the deputy director general in-charge of financial inclusion and payment systems in the founding team of UIDAI (Unique Identification Authority of India). He has made significant contributions to the Aadhaar enabled payments system, e-kyc (electronic know your customer) and direct benefit transfers.
The concept of Payments Bank was proposed by former RBI Governor Raghuram Rajan. In case of IPPB, its vast network of post offices will allow the organization to provide banking services to the most remote parts of the country. It will offer savings and current accounts up to 1 lakh and digital payments and remittances across entities and individuals. It will also offer financial services such as insurance, mutual fund, pension, loans, etc. in partnership with third party financial services providers.