Indian Post Payments Bank is offering savings account up to a balance of Rs 1 lakh.
The Ministry of Finance has approved the linking of savings bank accounts at post offices with the India Post Payments Bank (IPPB), sources close to the Ministry of Finance told The Sunday Guardian.
IPPB is currently offering savings account up to a balance of Rs 1 lakh, along with digitally enabled payments and remittance services, in Raipur and Ranchi.
Following the move, a post office account holder will have access to services which had, till now, been available only to bank account holders.
The linking of savings accounts at post offices with IPPB will be completed by next month, sources said.
“The linkage of Post Office account to IPPB will allow the account holder to transfer money from their account to any bank account.
There are 26 companies in line waiting to collaborate with IPPB. After the completion of digitisation, all the 650 IPPB branches will start functioning from next month,” a source said.
“Currently, there are 34 crore saving accounts, of which 17 crore accounts are opened in post offices. After the digitisation, all the post office account holders will be able to avail full fledged digital banking services,” a senior Finance Ministry official told The Sunday Guardian.
The digitisation move will pave the way for making the post office as one of the largest banking networks in the country through its 1.55 lakh branches.
The IPPB is administered by the Reserve Bank of India (RBI) and banking service at post offices is administered by the Finance Ministry. Earlier, India Post, a postal network with over 1.5 lakh post offices in India, had started core banking services and was providing money transfer, but only within the post office savings bank (POSB) accounts.
“From September this year, the account holders in post office will able to pay for post office products from their IPPB accounts. This will include deposit money for Sukanya Samridhi Yojana, recurring deposits, speed post, etc,” same official cited above said.
A post office is available for every 8,354 citizens in India, which makes the postal department much larger than any single Union Government agency.