Moneycontrol NewsPayments banks are a step in right direction which will redefine banking in India. India Post Payments Bank is doing all it can to step up financial inclusion in the country. In an interview with Mint, India Post Payments Bank Chief Ashok Singh said that simplicity is key for its operations.
“I just have to keep it simple which is also an operational necessity. Simplicity hurts no one,” said Singh.
The bank, which became the second entity to start operations in January by launching a pilot in Raipur and Ranchi, plans to scale up its branches to 650 by end of September. With a bottom-up approach, the bank is targeting people with no mobile phones and who rely on direct benefit transfers (DBT).
Singh said he aims to simplify payments for both feature phone and smartphone customers and the focus will be on payment solutions and not on banking solutions.
Customers can even borrow money at this bank. India Post will offer small-ticket loans but the bank is yet to place an analytics engine to track transaction history of its customers.
Other services the bank will provide are in the mutual fund and insurance space. The bank is looking at only index funds for the former as for the latter, it will only focus on life cover products.
The central bank has given in-principle approval to 11 applicants for a payments bank. So, India Post has competition. When Airtel Payments Bank gives its customers 6.1 percent, India Post has fixed interest rates at 4.5 percent. But, Singh says that unlike other payments banks, India Post doesn’t charge a transaction fee.
To keep things easy and simple for both customers and employees, Aadhaar will be used and transactions will be enabled via biometrics.
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