Postal Department awaiting RBI nod to transform it into a small finance bank
Furthermore, the only way out now for india Post Payments bank appears to be to convert itself into a small finance bank. Accordingly, this is precisely what IPPB is doing now and it has already applied for a small bank license and is hoping to receive the regulator’s nod early next year.
Moreover once that happens, india Post’s banking venture can accept deposits beyond Rs 1 lakh and also give out loans. Apparently the same concept of reaching banking services to the remote villages and helping micro and small enterprises with funding etc. can help the organization and remain relevant. Hence there are limitations to the operation of a payments bank. Perhaps one main drawback is it cannot accept deposits beyond Rs 1 lakh. It cannot offer any loans either.