Cabinet hikes spending for India Post Payments Bank by 80% to Rs 14.35 bn

The Cabinet on Wednesday approved an increase of 80 per cent in spending on India Post Payments Bank (IPPB) to Rs 14.35 billion, three days ahead of the nation-wide launch of the payments bank.

The additional outlay of Rs 635 crore is primarily on account of costs related to technology (Rs 4 billion) and human resources (Rs 2.35 billion), an official statement said after the Cabinet meeting chaired by Prime Minister Narendra Modi.

IPPB services are slated for a nationwide launch by the Prime Minister Narendra Modi on September 1.

On Day 1 of the launch, IPPB will have 650 branches and 3,250 access points across the country and will offer a range of products such as savings and current accounts, money transfer, direct benefit transfer, bill and utility payments and enterprise and merchant payments.

These products will be offered through multiple channels such as counter services, micro ATMs, mobile banking app, SMS and IVR.

All 1.55 lakh post offices in the country will be linked to IPPB system by December 31, 2018, the statement said.

The Cabinet has also approved payment of incentive/ commission to the last-mile agents (postal staff and gramin dak sewaks) directly in their accounts for providing IPPB services.

A part of commission, to be paid by IPPB to Department of Posts, will be used for upgrading the infrastructure.