For the past few weeks, rumour mongers have been spreading some baseless media news regarding India Post Payments Bank (IPPB). Some of the free services offered by IPPB were beefed up and quoted against the charges levied by both public and private banks. There has also been a mix up between the services of Postal Savings Bank and India Post Payments Bank. We decided to give our readers more clarity on the same, so let’s hear some facts.

What is India Post Payments Bank?

Payments bank were introduced to popularise banking among the masses. It was licensed on August 19th, 2015 under the 1949 banking regulation act section 22. These new model banks can accept a restricted deposit, limited to Rs 1 Lakh. RBI can increase the limit based on the bank’s performance. For money transactions, you have the option to use debit cards or atm cards, net banking and mobile banking. But there were also restrictions like these banks should not involve in lending activities and must have 25 percent of its branches in rural areas.

India Post Payments Bank was the third such entity to receive the permit for Payments Bank after Airtel Payments bank and Paytm Payments bank. RBI has earlier given “in-principle” license to a total of 11 entities. Since IPPB being introduced through government operated India Post, it has got all the attention as expected.

India Post Payments Bank launched, starts pilot branches at Raipur and Ranchi

You can open three distinct accounts with IPPB – Regular account – Safal, Basic Savings Bank Deposit Account (BSBDA) –  Sugam and BSBDA Small – Saral. For all account type, IPPB will be offering an interest rate of up to 5.5 percent on money deposit.

IPPB will offer basic banking services like payments including social security payments, utility bill payments, recharges etc. You can do person to person both domestic and cross-border money transfer. Other services include distribution of insurance, mutual funds, and pension products. It will also act as business correspondent to other banks for credit products.

What is Post Office Savings Account?

Post Office Savings Account (POSB) is a type of regular savings account. The POSB accounts are highly secure instruments to deposit funds which offer full or partial liquidation when the need arises. These accounts are ideal for senior citizens who want to earn a regular income without exposure to risk.

Due to the country-wide reach of post offices, the government introduced the concept of opening savings account through post offices. Post Office savings account can be opened by an adult, minor (minimum 10 years of age), a joint account by 2 or 3 adults, or a person of unsound mind. To open an account and for more details, you can visit the nearest post office.

Now let’s see some of the features and compare the charges levied by POSB and IPPB. The compilation is purely based on internet sources. So please check with the nearest India Post for correct charges.

POSB  account vs IPPB Savings account charges and features

AccountPost Office Savings BankIndia Post Payments Bank
 Account opening
EligibilityAnybody 10 years and
above with KYC
Anybody 10 years and
above with KYC
Initial minimum deposit
Rs 20 Minimum opening amount
Rs 500 with Cheque Book
Rs 100
Minimum account balanceRs 50 for No Cheque Book
account Rs 500 for Cheque Book
Maximum balanceNo LimitsRs 50,000 – 1,00,000
Nomination facilityAvailableAvailable
ATM/ Debit CardFreeFree
Subsequent cardsCharges UnknownRs 100
Annual maintenance charges
(from 2nd Year)
Charges UnknownNA
PIN regeneration through
Charges UnknownRs 50
 Servicing / Transactions
Minimum Quarterly
Average Balance (QAB)
Annual Interest Rate 4% 5.5%
If QAB is up to and
including Rs 25,000
 4.50 percent
If QAB is above Rs 25,000
and up to and including Rs 50000
 5.00 percent
If QAB is above Rs 50,000 5.50 percent
Quarterly Non-maintenance
Interest paymentQuarterlyQuarterly
Mobile AlertsFreeFree
Monthly Account statement
(including duplicate statements)
Doorstep bankingNo Doorstep BankingRs 15-35
Interbank remittances charges
(IPPB Intrabank remittance is free)
No ChargesLimited free usage,
Charged per remittance
Branch banking  
Free monthly customer induced
transactions. Subsequently at
Rs 20 per transaction at branch
and Customer Service Points
Free4 Free
Charge frequencyMonthlyMonthly
ATM monthly transactions  
At IndiaPost ATMsAll freeAll free
At Punjab National Bank’s ATMsAll freeAll free
At other bank’s ATMs: MetroUnknown3 transactions free
At other bank’s ATMs: Non- MetroUnknown5 transactions free
Additional transactions at
Other Bank’s ATMs
UnknownFinancial: Rs 20
UnknownNon-financial: Rs 8
Maximum ATM withdrawal per
UnknownRs 10,000
Maximum ATM withdrawal per dayUnknownRs 25,000
Maximum cumulative spend at
POS outlets and e-commerce sites
per day
UnknownRs 65,000
Standing Instruction Charges
Account status change
(Inactive to active and
dormant to active)
Account Closure Charges within
14 days of Account Opening
Account Closure within 6 months
– Customer induced
Rs 250Rs 250
Balance certificate per
ATM card/ KIT returned due
to wrong address
UnknownRs 100
Charges to be recovered from IPPB
customer in case of cheque bounce
100% of clearing charges100% of clearing charges
Remittances charges InterPost Fund Transfer
between CBS Post Offices
  For IPPB
Mode of Outward Remittance Charges (excluding service tax)
at branch and doorstep banking
NEFT Up to Rs 10,000 – Rs 2.5 per
 Rs 10,000 – Rs 1 Lakh
Rs 5 per transaction
IMPS Upto Rs 1 Lakh
Rs 5 per transaction
AEPS Upto Rs 10,000 (max. limit)
UPI Upto Rs 1 Lakh (max. limit)
*99# Upto Rs 5,000 (max. limit)
The charges are subject to
any regulatory changes that might
be intimated from time to time.
Doorstep banking  No Doorstep Banking for POSB Charges for IPPB 
Service Charges (INR)
Doorstep Banking – On-boarding Customer On- boarding
Doorstep Banking – Cash
based transactions
 Cash Deposit and Withdrawal
  For cash transactions
  Rs 2,001 : Rs 15 per visit
  Rs 2001 – 5,000 :
Rs 25 per visit
  Rs 5,001 – 10,000 :
Rs 35 for per visit
  Cash transactions above Rs 10,000
will not be offered at the doorstep
Doorstep Banking – Non-cash
based Financial Transactions
Rs 10 per visit
Doorstep Banking – Non-cash
based Non-Financial Transactions
 Balance Enquiry
  Mini Statement

In addition to the service charges mentioned in the above table for IPPB, you also need to pay additional service tax at the rate of 15 percent. In the present scenario for every extra transaction, you will be charged Rs 20 and an extra service charge of 15 percent. That’s in total the deducted amount will be Rs 23. Similarly, service charge for ATM cards after the first year will be Rs 115. The tariffs for inter-post fund transfer service via CBS in POSB is said to be reasonable.

So far we have seen that the widely circulated rumours about free services offered by India Post Payments Bank are limited. There is much confusion to the crowd between the two entities – Postal Savings bank and India Post Payments Bank. But still, there are several undisclosed service charges and limitations for these two entities. For more details regarding India Post payments bank read our previous article. This article isn’t exhaustive, so please excuse us for any errors. For more inquiries directly contact India Post Payments bank [link]. Peace!

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