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Speaking at the event held at Talkatora Stadium in the capital, PM Modi said, "IPPB is going to bring a huge change in the country's economic, social situation and will reach to every nook and corner of the country. This payments bank will revolutionise banking and digital payments."
The prime minister added that, "IPPB will also be a great help for the farmers and schemes like PMFBY (PM's crop insurance scheme) will gain more strength from it."
PM Modi also spoke on the rising non-performing assets (NPAs) or bad loans in the banking sector and blamed the previous UPA government for the mess.
Union minister of communications Manoj Sinha, also present at the event, said, "With the launch of IPPB, the trusted postman will now become a banker to millions of unbanked & under-banked Indians who have so far had no access to financial services."
Earlier this week, the cabinet had approved 80 per cent increase in spending for IPPB to Rs 1,435 crore, a move that will arm it with additional ammunition to compete aggressively with existing players like Airtel Payments Bank and Paytm Payments Bank.
What is IPPB: The India Post Payments Bank (IPPB) is a public sector company under the department of posts and ministry of communication with a 100 per cent equity of the government of India, and governed by the Reserve Bank of India (RBI).
How it will function: It will focus on providing banking and financial services to people in rural areas, by linking all the 1.55 lakh post office branches (that’s nearly 2.5 times the bank network) with India Post Payments Bank services by the end of 2018. Around 11,000 postmen both in rural and urban areas will provide doorstep banking services.
This will create the country’s largest banking network with a direct presence at the village level. IPPB has been allowed to link around 17 crore postal savings bank accounts with its accounts.
IPPB offers three types of savings accounts: regular savings accounts, digital savings accounts and basic savings accounts. The annual interest rates on all three are fixed at 4 per cent. IPPB can also accept deposits up to Rs 1 lakh per account from individuals and small businesses, and facilitate money transfer to other bank accounts, among other services. In addition, you can also pay for services of around 100 firms (including phone and DTH recharges) that are present on the Bharat Bill payments system of the National Payments Corporation of India.
IPPB has been launched with 650 branches in addition to 3,250 access points co-located at post offices. Two pilot IPPB branches were inaugurated on January 30, 2017 at Raipur and Ranchi.
Suresh Sethi is the managing director and chief executive officer of IPPB.
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