Union Budget 2024: Over 100 Branches Of India Post Payments Bank To Be Set Up In Northeast India

In her Budget speech, finance minister Nirmala Sitharaman on Tuesday (July 23) announced the setting up of more than 100 branches of India Post Payments Bank (IPBB) in Northeast India. 

“More than 100 branches of India Post Payments Bank will be set up in the North Eastern region to expand the banking services,” the FM said. 

The move will likely offer a major fillip to digital banking services across the Northeast India and bring more people under the ambit of banking. 

The state-backed payments bank leverages India’s more than 1.55 Lakh post offices as access points and 3 Lakh postmen to offer doorstep banking services. Apart from savings accounts and money transfer, the India Post Payments Bank offers insurance via third-party players as well as utility payments.

For the uninitiated, a payments bank operates like a leaner, digital-first version of a traditional bank, focussing specifically on facilitating payment transactions. These payments banks can accept deposits up to INR 2 Lakh in an account. 

Currently, there are very few active payments banks in the country, including Airtel Payment Bank, Fino Payment Bank, NSDL Payment Bank, Jio Payment Bank and IPPB. 

The announcement is also part of the Centre’s push for the fintech ecosystem and to boost financial inclusion in the remote parts of the country. With this, the government also plans to enable more people in the far flung areas of the country to access banking services on their smartphones.

The push for the IPPB comes months after the Reserve Bank of India (RBI) cracked the whip on one of the biggest players in the space, Paytm Payments Bank. The central bank barred the company from undertaking deposits or processing fund transfers, including UPI payments.

The payments bank space is part of the larger Indian fintech space, which, as per Inc42, is projected to reach an addressable market of $2.1 Tn by 2030.