India Post gets Cabinet nod for 650 PB branches

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NEW DELHI: The Union Cabinet on Wednesday cleared a proposal to set up India Post Payments Bank (IPPB), as a public limited company with 100% government equity under the Department of Posts, at a total cost of Rs 800 crore, including  Rs 400 crore as equity with a grant of Rs 400 crore as recommended by the Public Investment Board (PIB).

Announcing the Cabinet decision, Telecom Minister Ravi Shankar Prasad said that India Post  has plans to have 650 branches operational by September 2017. “By September 2017, all 650 branches of postal payments bank will become operational. This we had planned for three years but now we will be doing it in a year,” he said.

The proposal is that IPPB may set up one headquarter and up to 650 branches co-located in district headquarter post offices. The project may be rolled out in a phased manner and the bank may complete its nation-wide rollout in five years.

The minister said that the payments bank, which will be run by a chief executive officer, will be professionally managed. Provision has been made to nominate Department of Posts Secretary for the post of the part time, non-executive chairman of IPPB.

The Reserve Bank of India (RBI) has also granted in-principle approval to DoP for setting up payments bank on September 7, 2015, with a stipulation to complete all formalities for setting up the bank with 18 months.

“We have 1.54 lakh post offices of which 1.39 lakh are rural post offices and 650 payment bank branches. It will be the largest bank in the world in terms of reach. These post offices will be equipped with Micro-ATMs for facilitating both cash and digital transactions. 650 branches of postal payments bank will be established in the country which will be linked to rural post offices,” Prasad said.

Meanwhile, the  government approved a proposal to allow candidates from the private sector to work in central public sector enterprises (CPSEs) for a period of five years.  The Cabinet has given its ex-post facto approval to the proposal for amendment to the resolutions dated March 3, 1987 of the Public Enterprises Selection Board (PESB).

The Cabinet also gave its approval to signing and ratifying of an agreement between India and Qatar on cooperation and mutual assistance in Customs matters.

Paddy MSP up by Rs 60

The Cabinet approved a hike in the minimum support price (MSP) of paddy by Rs 60 Rs 1,470 per quintal for the 2016-17 kharif season. MSP is the rate at which the government buys the grain from farmers. The Cabinet also approved a substantial increase in the MSP of pulses for the 2016-17 kharif season. The government had fixed the MSP of common variety paddy at Rs  1,410 and grade A variety grain at Rs 1,450 per quintal for 2015-16 kharif (summer) season.