India Post Payment Bank to scrap debit cards, use QR codes

MUMBAI: Customers of the Indian Post Payments Bank (IPPB) will be able to do offline transactions only through QR codes using Aadhaar-based biometric readers for authentication. Most postmen in the about 1.6 lakh post offices across the country will be opening accounts on behalf of the payments bank by December 2018.

The absence of ATMs or debit cards will reduce costs for the bank and enable it to provide zero-balance accounts economically. However, the dependence on biometric authentication, which does away with PIN, will make the bank heavily dependent on the Aadhaar system.

Customers can withdraw cash using the post office network and also do cashless transactions using the bank's mobile application or the bank's QR code card. For acceptance of the QR code card, IPPB will enable and equip small merchants to accept QR-based payments. The bank will also facilitate online transactions using the net-banking platform.


Last year, the government had appointed Suresh Sethi, the former MD of Vodafone M-Pesa, as MD and CEO of the bank. Sethi was earlier with Citigroup and Yes Bank, and worked with Vodafone M-Pesa across India, Kenya, the UK, Argentina and the US.

In a pre-launch press conference in Mumbai, Harish Chand Agrawal, chief postmaster general (Maharashtra Circle), said that postmen would provide doorstep service. "Indian Post Payments Bank will provide postal department customers with a complete bouquet of banking services. In turn, postal savings bank customers will become sweep accounts for IPPB customers when the balance exceeds Rs 1 lakh."

IPPB will also accept digital payments at counters, offer small savings schemes online and increase its footprint in the electronic world by providing electronic cash on delivery to customers at their door steps. The small savings schemes include the National Savings Certificate, Kisan Vikas Patra and Public Provident Fund.