The Public Investment Board (PIB) has recommended that the payments
bank may be set up as a public limited company under the Department of
Posts with 100 per cent government equity.
"With a project cost of Rs 800 crore (Rs 400 crore equity and Rs 400
crore grant) and the draft cabinet note has been forwarded to Cabinet
Secretariat seeking the approval for the project," Telecom Minister Ravi
Shankar Prasad said in a written reply to the Lok Sabha.
The Reserve Bank of India granted in-principle approval to DoP for
setting up payments bank on September 7, 2015, with a stipulation to
complete all formalities for setting up the bank with 18 months.
The present proposal is that the India Post Payments bank (IPPB) may
set up one headquarter and up to 650 branches co-located in district
headquarter post offices.
"...more than 60 large companies have approached the Department of
Posts for collaboration with the prospective IPPB," the Minister added.
Prasad said the project may be rolled out in a phased manner and the bank may complete its nation-wide rollout in five years.
"All the post offices in a district may be linked to the respective
IPPB branch and may become the access point for the services of payments
bank and will coordinate with the payments bank branches to which they
are mapped," the Minister said.
He further said services available through the payments banks will be
basic banking services like acceptance of demand deposits such as
current and savings accounts up to a balance of Rs 1 lakh, various kinds
of payments, including social security payments like DBT payments,
person to person remittances (both domestic and cross-border).
"Apart from these, financial products like insurance, mutual funds,
pensions, credit etc may be distributed through third party tie ups with
banks and other financial service providers especially in rural areas
and among the under banked segments of the society," he added.
Regarding International Finance Corporation, a member of World Bank,
has shown interest in picking up stake in the business, Prasad said some
preliminary discussions had taken place but no formal proposal to this
effect has been received.