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India Post Payments Bank starts ops, aims 650 branches by Sep

State-owned India Post Payments Bank today launched its operations by introducing pilot services in Raipur and Ranchi, and expects to expand its presence to 650 branches across the country by September 2017.

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State-owned India Post Payments Bank today launched its operations by introducing pilot services in Raipur and Ranchi, and expects to expand its presence to 650 branches across the country by September 2017.

The bank will offer an interest rate of 4.5 per cent on deposits up to Rs 25,000; 5 per cent on deposits of Rs 25,000-50,000 and 5.5 per cent on Rs 50,000-1,00,000, India Post Payments Bank (IPPB) Chief Executive Officer A P Singh said.

The government has sanctioned Rs 800 crore equity for the Payments Bank, of which it has already infused Rs 275 crore, he added.

"The 650 branches will be umbrella branches that will map all the 1.55 lakh post offices in the country. Also we will progressively put smartdevice with each of the 3 lakh postmen," Singh added.

IPPB is the third entity to receive payments bank permit after Airtel and Paytm. Airtel has launched its commercial operation across India with an investment of Rs 3,000 crore offering interest rate of 7.25 per cent on deposits, free money transfer from Airtel to Airtel numbers within Airtel Bank, money transfer to any bank account in the country.

Paytm, promoted by Vijay Shekhar Sharma and backed by Chinese e-commerce major Alibaba, plans to roll out payments bank with initial investment of about Rs 400 crore.

Asked Airtel Payments Bank offering attractive deposit rate, Singh said "it is public money which is building India Post Payments Bank. Governments don't compete with corporates, they can scheme the market, we will nurture it from below. Our primary role is to deepen and broaden the market."

He said RBI has indicated that 1,000 ATMs of post offices will be transferred to Post Bank and the newly formed bank will issue RuPay debit cards to begin it.

"We designed Aadhaar as payment address of individual, but no bank picked that up. Post office is the only organisation which has a universal customer base and we intend to have something like this that if you have Aadhaar number you can withdraw money," Singh said.

Telecom Minister Manoj Sinha said that IPPB plans to have 650 branches across the country by September 2017.

Terming IPPB as a mechanism for financial inclusion and a milestone, Sinha said the payments bank -- the third one to get a permit after Airtel and Paytm and the first one promoted by the government -- will not just conduct business but also serve people.

In 2015, RBI had granted 'in-principle' approval to 11 entities, including the Department of Posts, to set up payments banks and proposed to give such licences 'on tap' basis in future. Payments banks can accept deposits up to Rs 1 lakh per account from individuals and small businesses.

The new model of banking allows mobile firms, super market chains and others to cater to banking requirements of individuals and small businesses. It will be set up as a differentiated bank and will confine its activities to acceptance of demand deposits, remittance services, Internet banking and other specified services.

 

(This article has not been edited by DNA's editorial team and is auto-generated from an agency feed.)

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