The Central Government has initiated preparations to sell its stake in India Post Payments Bank (IPPB), with plans to go public by March 2026 in accordance with licensing norms set by the Reserve Bank of India (RBI).
Government’s Ownership and Investment Plans
IPPB was established under the Department of Posts, with the government holding 100% equity. According to sources familiar with the matter, discussions are underway regarding the extent of equity the government will retain in the bank after its public listing.
IPPB’s Journey Toward Becoming a Small Finance Bank
The decision to take IPPB public is part of a broader strategy to prepare for its transformation into a small finance bank. For this transition, IPPB will require a special licence from the RBI.
As per RBI’s licensing norms, payments banks must list themselves within three years of achieving a net worth of ₹500 crore. To comply with this requirement, IPPB must go public by March 2026, stated R. Visweswaran, Managing Director of IPPB.
“We have already informed the government and sought guidance on this matter,” Visweswaran added. Listing and diversified ownership is mandatory for all payments banks, including those backed by telecom giants like Airtel and Jio, once they meet the net worth threshold.
Industry Landscape and IPPB’s Progress
Currently, Fino Payments Bank is the only listed payments bank in India and has already applied for a small finance bank licence.
Payments banks are unique in their operations, serving underserved segments like migrant workers, low-income households, small businesses, and unorganised sector entities. While they provide savings accounts and remittance services, their scope is limited as they cannot accept deposits exceeding ₹2 lakh or offer loans.
IPPB’s Expanding Network and Future Goals
IPPB currently operates through one branch, 649 banking outlets, and leverages the extensive postal network where every postman and Gramin Dak Sevak functions as a business correspondent.
“By March 2026, we aim to achieve a major milestone by opening 130-140 million savings accounts,” said Visweswaran.
So far, IPPB has successfully opened 112 million accounts, with 26.8 million added in 2024 alone. Impressively, 59% of these accounts belong to women, and nearly 75% are located in rural areas, reflecting the bank’s focus on financial inclusion.
