IndiaPost becomes 3rd entity to receive licence to start payment bank operations
NEW DELHI: IndiaPost has become the third entity to receive a final license last week from the Central Bank to start its payment bank operations. Country’s largest telcom service provider Bharti Airtel and digital payments firm Paytm are the other two to have received the license while only Airtel has started operations so far.
The government has also appointed AP Singh has interim MD and CEO of the India Post Payment Bank. A 1986 Indian Postal Service Officer he was earlier Joint Secretary in the department of disinvestment, ministry of Finance and Deputy Director General incharge of financial inclusion and payments systems at Unique Identification Authority of India (UIDAI). Singh was one part of the founding team that launched Aadhaar and was stationed at the department of Post prior to UIDAI.
As per the initial road map, each post office in the country will offer the post bank services. The department of post has an existing network of around 1,55,000 post offices currently. ET had reported earlier that IndiaPost plans to open 650 new branches for the payment bank. The branches will be co-located with the existing post offices. The idea is that the 650 branches will be in located in postal district headquarters and all the branches under that particular head post office will be enabled by the payment bank services. This will cover the entire network of 155,000 post offices in the country.
Earlier this month, Airtel Payments Bank launched nationwide operations, offering 7.25% interest on savings bank balances, which is more than the maximum 7% paid by SBI on its fixed deposits. Bharti and Kotak Mahindra, which holds a 20% stake in the payments bank, would invest Rs 3,000 crore in the venture.
Payments banks can accept deposits from individuals and small businesses of up to Rs 1 lakh per account. And RBI had set a condition that formal license has to be obtained before 31 March.
ALIBABA backed Paytm also said early in January that it has received the final license from RBI and the company hopes to launch operations in February with the first branch coming up in Noida, Uttar Pradesh.
While operation of Payment Banks such as Paytm are likely to be focused on technology based differentiation, IndiaPost is banking on its huge reach especially in the rural areas to be successful.
Union Budget may levy new cess to provide social security to coolies.
Union Budget may levy new cess to provide social security to coolies
Government may announce a new cess in the forthcoming Union Budget 2017-18 to cover around 20,000 railway coolies under social security schemes run by the retirement fund body EPFO.
“There is a proposal from the labour ministry to levy a cess of 10 paisa per railway ticket to cover 20,000 railway coolies under the ambit of social security net through the Employees Provident Fund Organisation (EPFO),” a source said.
“The proposal makes a lot sense because 10 paisa cess per ticket will not burn of a hole into travellers’ pockets. Besides it would help railways to mop up funds to provide social security to coolies,” said the source.
This proposal is a one of the initiatives of government’s overall efforts to bring over 40 crore informal sector workers under the social security net of the EPFO and others like ESIC.
According to a back-of-the-envelope calculation, levying of this 10 paisa cess will help in collecting about Rs 4.38 crore every year, which will be enough to provide basic minimum facilities like PF, pension and group insurance to coolies.
Indian Railways issues 10-12 lakh rail travel tickets everyday, including 58% reserved tickets. Thus, the move can help mop up about Rs 1.2 lakh every day for the purpose.
Chairman of the Central Board of Trustees, EPFO’s apex decision-making body, labour minister Bandaru Dattatreya had already assured the members to look into the proposal mooted by employee representative Ashok Singh, the vice-president of Indian National Trade Union Congress, had floated the proposal at the EPFO’s trustees’ meeting in Bengaluru on December 19, 2016.
The forthcoming general budget is likely to be tabled in Parliament on February 1, 2017.
The proposed cess of 10 paise is on every ticket sold by Indian Railways. It will not be levied per passenger. One ticket sold by Indian Railways can have multiple passengers.