Exclusive: State-run India Post Payments Bank aims for 30% growth for new customers by year-end

Easwaran V- IPPB

New Delhi-based India Post Payment Bank (IPPB) is aiming for a 30 percent growth in terms of new customers by the end of this year, says Interim Managing Director and Chief Executive Officer V Easwaran.

In an exclusive interview to Moneycontrol on February 19, he said, "We have already crossed 8.5 crore customers. So, these numbers are growing. Now we are aiming to achieve the 30 percent growth in terms of new customers this year”.

He also added that IPPB is getting large number of new customers added on a daily basis. Easwaran V further pointed out that IPPB is working on the FASTag services, and they will come with this service shortly.

Edited excerpts:

What is India Post Payments bank target for this year?

We have already crossed 8.5 crore customers. So, these numbers are growing. While we have not kept any specific targets for these numbers, a 30% growth in customer base will be really what we are looking for by the end of this year. And very few banks have these kinds of numbers. And that too in a very short time period. We have been adding large numbers consistently on a daily basis.

We have been witnessing almost 20 to 25 percent year-onyear (Y-O-Y) growth. The growth in our customer base as well as higher growth in our balance sheet size also. Our focus mainly is on the unbanked and the underbanked section of the society.

We are reaching out to the last mile using the Department of Posts Network and onboarding new customers.

IPPB is not in Fastag services yet; any plan to launch it?

Yes, we are working on the FASTag services. There is still work to be done on that like the certification process, and getting other processes in place. So, we will be coming out in FASTag also shortly. Maybe in a few months from now, we should be out with it.

How do you see the future of the overall concept of payments bank in India amid several problems since its beginning?

Each of the payments bank currently operating, has got their own market. So, we all have created a segment for ourselves and we have filled in a lot of gaps. If you look at the underbanked section, which was what was prevailing around eight years ago and what it is now, it is a payments bank, which has actually filled this gap.

And within time we have seen a significant change especially in tier two, three and four cities. So that’s what the payments bank has actually done a phenomenal job. There is a profitability challenge, but yes, we have shown that given the right enabling factors, we can definitely generate business.
We can create products & profits both. Thankfully regulatory environment has been very supportive and we are hopeful, we’ll meet all challenges and emerge stronger.

IPPB were planning to join MF, insurance-related business through third party; how's it going?

Yes, we are into insurance distribution, using third-party products. We sell life, general & health insurance. There are the BCs (banking correspondents) who are actually trained and they are doing this transaction through the Micro-ATM. So that's a very exciting area that we have gone in because insurance has always had very less penetration in the country. Banks like ours are able to increase both awareness & penetration of insurance in tier three, tier four cities.

Other sectors, like mutual funds, and wealth management, we
have kept them for the coming future because first, we need to
create a base of savings accounts. And then we'll get into the wealth management products, like first savings, then take care of your health, and then we'll get into other products to add further value.

Your guidance on your current footprints across the country?

Over 1.5 lakh Micro-ATMs are there, which are given to the Gramin Dak Sevaks & Postmen of the Department of Posts. In parallel, we're also now tying up with other individual banking correspondents to increase the businesses. So that's where it is. And wherever Post Offices are there, our presence is there because we use their network instantly.