India post has received the payments bank licence from the Reserve Bank of India, making it the third entity to get such permit. The other two are country’s largest service provider Bharti Airtel and digital payments firm Paytm. Only Airtel has started operations so far.
The soon to be launched India Posts Payments Bank (IPPB) will confine its activities to acceptance of demand deposits such as savings and current accounts up to a balance of Rs 1 lakh, along with digitally enabled payments and remittance services. Insurance, mutual funds, net banking, pension and other specified services will be added later.
The first two branches of the IPPB will be inaugurated in Ranchi and Raipur on a pilot basis, with the operations likely to begin in a week. AP Singh has been appointed as interim MD and CEO of the IPPB.
In 2015, RBI had granted in-principle approval to 11 entities, including the department of posts, to set up payments banks. However, certain companies including Tech Mahindra, IDFC bank Ltd and Telenor Financial Services backed out and dropped their plans to roll out payments bank.
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