Indian Prime Minister Narendra Modi is using India Post Payments Bank (IPPB) to bring financial services to the doorstep of every citizen through the postal service.
According to BGR India, three lakh postmen and “Grameen Dak Sewaks” will have smartphones and biometric devices to handle transactions, operating like any other bank, but on a smaller scale and without any credit risk. The postmen will accept deposits of up to Rs 1 lakh, as well as remittance services, mobile payments/transfers/purchases and other banking services like ATM/debit cards, net banking and third-party fund transfers. However, it will not offer loans or credit cards.
IPPB, a subsidiary of India Post, launched last year with pilot services in Raipur and Ranchi. By the end of August it was set to open an additional 648 branches throughout the country, with at least one branch in every district. The bank offers products and services though multiple channels such as counter services, micro ATMs, mobile banking app, messages and interactive voice response.
At the time, IPPB CEO Suresh Shetty also revealed that 3,250 access points will be opened, co-located at post offices, and 11,000 postmen will be stationed both in rural and urban areas to provide doorstep services.
The bank received an investment of INR 14.5 billion ($225.2 million), and will be used by the government to distribute wages, subsidies, pensions and more, as well as create and link 170 million postal savings bank (PSB) accounts, which will enable IPPB customers to transfer and receive money from any bank account.
Prime Minister Narendra Modi noted that the doorstep service came from the threat that technology brought to the existence of the postal department and the livelihood of its postal workers.
“(The growing pace of) technology (in communication) threw a challenge. We used technology as a base to turn that challenge into an opportunity,” he added.