'Nod to Postal Department for payments bank a proud moment'

I would expect the dept to prepare itself properly for this: Communications and IT Minister Ravi Shankar Prasad

Communications and IT Minister Ravi Shankar Prasad on Wednesday said it was a proud moment for the Department of Posts to be granted 'in principle' approval by the Reserve Bank of India for starting a payments bank.

"I am very happy to learn that the postal department has been given a payment banking permission by the RBI. I thank the RBI governor and his team. This is a very proud moment for the Postal Department," the minister said.

"I have been trying since I became the minister to energise and make the vast network of postal department for financial digital inclusion and e-commerce activity. I would expect the department to prepare itself properly and effectively for this," he added.

Ten others who got the approval are Reliance Industries Ltd., Aditya Birla Nuvo Ltd., Cholamandalam Distribution Services Ltd., Airtel M Commerce Services Limited, Fino PayTech Limited, National Securities Depository Limited, Dilip Shantilal Shanghvi, Vijay Shekhar Sharma, Tech Mahindra Limited and Vodafone m-pesa Limited.

A payments bank, as defined by the Reserve Bank's draft rules, can accept deposits, both savings and current, up to a maximum of Rs.10,000 initially, with the stated primary role of extending payments and remittance services to small businesses and low-income households.

Besides physical branches, some key facilitators for such services can include ATMs, mobile and internet banking, authorised business correspondents and point-of-sale terminal locations, as in retail stores.