Lok Sabha Question No. 3639 (UNSTARRED), answered on 2019-01-02
Subject: Banking Access Points
Ministry: COMMUNICATIONS
Asked by: FEROZE VARUN GANDHI, RAJIV PRATAP RUDY

## GOVERNMENT OF INDIA MINISTRY OF COMMUNICATIONS DEPARTMENT OF POSTS

## LOK  SABHA UNSTARRED QUESTION NO.3639 TO BE ANSWERED ON 2 ND  JANUARY, 2019

## BANKING ACCESS POINTS

3639. SHRI FEROZE VARUN GANDHI: SHRI RAJIV PRATAP RUDY:

Will the Minister of COMMUNICATIONS be pleased to state:

- (a) the number of post offices that have been converted into banking access points so far, State/UT-wise;
- (b) the funds allocated, released and utilised for establishment and operations of the India Post Payments Bank (IPPB), State/UT-wise;
- (c) the details of the revenue streams the Government is capitalising on;
- (d) whether any particular incentives are being put in place for promoting use by women, senior citizens and other disadvantaged groups;
- (e) whether IPPB is trying to include the unorganized retail sector on the platform and if so, the details thereof; and
- (f) whether the Government thinks the said model is financially viable over a long period of time given the revenue stream of a payments bank and if so, the details thereof?

## ANSWER

## THE MINISTER OF STATE (IC) OF THE MINISTRY OF COMMUNICATIONS & MINISTER OF STATE IN THE MINISTRY OF RAILWAYS (SHRI MANOJ SINHA)

- (a) The  details  of  number  of  Post  offices  that  have  been  converted  into  banking  access points of India Post Payments Bank (IPPB) are enclosed at Annexure I.
- (b) Total outlay approved by the Central Government for the project of Setting up of India Post  Payments Bank (IPPB) is Rs. 1435 Cr. Till  date  Rs  1100  crores has  been  allocated  to IPPB through Department of Posts (DoP). The remaining fund to the tune of Rs 335 crores will be released to IPPB as and when allocated by Ministry of Finance.  The allocation and release of funds to IPPB in three years is as under:

| Year    | Allocated ( Amount in crores)   | Allocated ( Amount in crores)   | Released to IPPB till date ( in crores)   |
|---------|---------------------------------|---------------------------------|-------------------------------------------|
|         | Equity                          | Grants-In-Aid                   |                                           |
| 2016-17 | 275                             | 25                              | 300                                       |
| 2017-18 | 125                             | 375                             | 500                                       |
| 2018-19 | 300                             | -                               | 300                                       |
| Total   | 700                             | 400                             | 1100                                      |

Rs 700 crores have been utilized by way of equity infusion to the IPPB for establishment and  operations.  Bank  has  utilized  21.05  crores  out  of  Grants-In-  Aid  as  on  30.12.2018.  The funds have not been allocated to State/UT.

(c) The India Post Payments Bank (IPPB) has been set up based on the payments bank guidelines  issued  by  Reserve  Bank  of  India  and  can  undertake  certain  restricted  activities specified therein. Revenue from these activities include:

-  Commission earned on remittances, bill payments including utility bill payments, Direct Bank transfer (DBT) payments.
-  Commission from sales of third party products like insurance, credit, Mutual funds etc.
-  Doorstep banking service charge.
-  Interest income from investments etc.

(d) IPPB has enabled opening of accounts,  distribution of DBT, cash transactions (deposits and  withdrawal),  money  transfers  and  bill  payments,  which  will  target  senior  citizens,  homemakers  and  other  disadvantaged  groups  including  migrant  labourers  through  the  doorstep banking services delivered by Postmen and Grameen Dak Sevaks (GDSs) with nominal fees.

(e) IPPB's  objective  is  to  create  digital  and  less-cash  economy  by  enabling  a  digital acceptance merchant eco-system. Therefore, IPPB is focusing on unorganized retailer sector such as kirana  shops, mobile  recharge  vendors,  laundrymen,  tea  vendors, food  stalls  etc.  to promote  acceptance  of  digital  payments  using  a  simplified,  less  capital  intensive  (Quick Response) QR code-based solution.

(f) As  per  the  Reserve  Bank  of  India's  guidelines,  the  Payments  Bank  can  only  offer payments and accept deposits of their customers directly. However, a Payment Bank can tie up with  third  party  financial  institutions  to  provide  complete  bouquet  of  financial  products  and services which includes credit, insurance and mutual funds etc. which will add to the revenue stream of IPPB and are critical for payments bank to self sustain. IPPB is anticipated to break even in the fourth year of operations by growth in the customer base, transaction income and tight control on cost centers.

## ANNEXURE I

| S No   | Name of the State /UT     |   Total No of Post office Access points rolled out as on 30.12.2018 |
|--------|---------------------------|---------------------------------------------------------------------|
| 1      | Andaman & Nicobar Islands |                                                                   1 |
| 2      | Andhra                    |                                                                8810 |
| 3      | Arunachal Pradesh         |                                                                  57 |
| 4      | Assam                     |                                                                 770 |
| 5      | Bihar                     |                                                                3742 |
| 6      | Chandigarh                |                                                                  52 |
| 7      | Chhattisgarh              |                                                                 734 |
| 8      | Dadra & Nagar Haveli      |                                                                  32 |
| 9      | Daman & Diu               |                                                                  15 |
| 10     | Delhi                     |                                                                 453 |
| 11     | Goa                       |                                                                 223 |
| 12     | Gujarat                   |                                                                6126 |
| 13     | Haryana                   |                                                                2528 |
| 14     | Himachal Pradesh          |                                                                2059 |
| 15     | Jammu & Kashmir           |                                                                1068 |
| 16     | Jharkhand                 |                                                                1328 |
| 17     | Karnataka                 |                                                                4477 |
| 18     | Kerala                    |                                                                2503 |
| 19     | Lakshadweep (UT)          |                                                                   0 |
| 20     | Madhya Pradesh            |                                                                5701 |
| 21     | Maharashtra               |                                                                7594 |
| 22     | Manipur                   |                                                                  47 |
| 23     | Meghalaya                 |                                                                  55 |
| 24     | Mizoram                   |                                                                  37 |
| 25     | Nagaland                  |                                                                  51 |
| 26     | Odisha                    |                                                                3316 |
| 27     | Puducherry (UT)           |                                                                  90 |
| 28     | Punjab                    |                                                                2578 |
| 29     | Rajasthan                 |                                                                2884 |
| 30     | Sikkim                    |                                                                   7 |
| 31     | Tamil Nadu                |                                                                7245 |
| 32     | Telangana                 |                                                                4467 |
| 33     | Tripura                   |                                                                 104 |
| 34     | Uttar Pradesh             |                                                                8469 |
| 35     | Uttarakhand               |                                                                1323 |
| 36     | West Bengal               |                                                                1358 |
|        | Total                     |                                                               80304 |

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