India Post's payments bank is here and has problems of plenty & legacy

The latest payment bank underwritten by the government of India may boast an extensive network, but legacy issues and a high-cost business model may work against it

With a budget of Rs 14.35 billion allocated by the government, sleeping giant India Post is hoping to reincarnate itself as the India Post Payments Bank (IPPB). Even before the glittery launch last Saturday by Prime Minister Narendra Modi, the payment bank was already the biggest in the country. It now seeks to convert all 155,000 post offices into banking access points, and more than 400,000 India Post employees are set to become bankers. 

Is the Rs 14 billion gamble likely to pay off?

The clues to India Post’s banking future lies in the past. Ever since the RBI rolled