India Post Payments Bank launch likely this month; RBI may give nod soon

The much-awaited launch of India Post Payments Bank (IPPB) can happen this month because KPMG has provided third-party certification to the banking platform, which is being tested since March, and the RBI is likely to give the green signal soon.

According to officials at IPPB, the banking platform has been running almost without a glitch and KPMG has certified the platform ready to use.

“We have secured third-party certification from KPMG. The RBI’s approval is expected soon, and after that the commercial launch will be announced,” an official added.

IPPB, which has been delayed by months, is running pilot services in Raipur and Ranchi. To launch its commercial service, it needs the go-ahead from the RBI for the software platform used for systems integration.

For the pilot, IPPB had used the platform of Punjab National Bank but as the bank has now developed its own platform, the RBI needs to certify it. 

It takes four-six months to secure certification from the RBI.

HP, which was awarded the contract last year, has built the software for integrating various functions of the bank. IPPB has provided smartphones to postmen to do banking functions. The infrastructure has been put in place for the bank to commence commercial services, the official added.

The Department of Posts was one of the 11 entities to get the in-principle nod from the RBI in 2015 for setting up a payments bank. Many other entities including Airtel and Paytm have launched services. 

IPPB missed the September 2017 deadline to open 650 branches across the country primarily because it failed to get a system integrator (SI) on board on time. 

When launched, IPPB will be a boon to people in rural areas. India has 154,000 post offices, of which 139,000 are rural. The government is planning to utilise the 650 branches to serve as controlling offices to service and monitor all post offices in the country.

Communications Minister Manoj Sinha had said IPPB was anticipated to acquire about 80 million customers in five years. 

Suresh Sethi had been appointed managing director and chief executive officer of IPPB.

An account holder in a payments bank can deposit up to Rs 100,000, withdraw cash from authorised centres, and make payments as is done in the case of a savings bank account in a full-fledged commercial bank.