Increasing the Uptake of India Post Payments Bank Services

The Department of Post’s payments bank with its deep reach, is opportunely placed to drive the objective of financial inclusion for the rural population. However, the uptake of its products and services has been low since inception. How can the payments bank increase uptake of its services?

India Post Payments Bank (IPPB) was set up under the Department of Post, Ministry of Communication, in response to the new model of payment banks proposed by Reserve Bank of India (RBI) in November, 2014. IPPB was launched with the objective of driving financial inclusion at the last mile by bringing customers under formal banking channels and providing access to banking services at affordable rates. It was designed to leverage the field network of the Department of Posts (DoP) for offering payment bank services to the rural population, using Door-step assisted banking, along with the regular counter services through the Postmen/ Gramin Dak Sevaks (GDS).

CSBC teams observing a Gramin Dak Sevak opening an IPPB account for a customer at an India Post Branch Office in Ramanagara District, Karnataka
CSBC teams observing a Gramin Dak Sevak opening an IPPB account for a customer at an India Post Branch Office in Ramanagara District, Karnataka
CSBC team conducting interviews with Postal Assistants and Postmen in a India Post Post Head Office in Bengaluru, Karnataka
IPPB communication material at an India Post Sub Office in Bengaluru, Karnataka
CSBC team conducting interviews with Gramin Dak Sevaks and customers about their usage of digital financial services in Ramanagara, Karnataka
Rural India Post Branch Offices in Ramanagara, Karnataka
Rural India Post Branch Offices in Ramanagara, Karnataka

Behavioural challenge and methodology

Since its inception, IPPB is facing two main challenges:

Low uptake of IPPB products and services: 55% of accounts have not done any transactions since inception. The national average balance for an IPPB account is Rs 268.
Limited use, after uptake: 52% of End Users have never logged in to the device, 66% of End Users are not performing financial transactions.

Hence, CSBC’s mandate in terms of overall objectives is:

To diagnose the behavioural barriers and facilitators and recommend behavioural interventions (agents-related and customer-related) for increasing the uptake of IPPB services
To make behaviourally-informed product and/or service-related (systems-level) recommendations for increasing the uptake of IPPB services

In order to understand the nuances of the behavioural challenge, we conducted a two-fold formative research for diagnosis:

Global literature review on behavioural insights related to agent banking and digital financial inclusion, and
Dipstick exploratory qualitative research in Haryana (northern India) and Karnataka (southern India) with Department of Post staff, IPPB staff, IPPB Agents at Head Office, Sub-Office and Branch Office, and customers (both existing and potential)

This was followed by an online design workshop with key stakeholders aimed at presenting the results of this diagnosis, identifying the high-priority barriers and facilitators to the desired behaviours and discussing the long list of intervention ideas and reco

Project Information

Name: Increasing the Uptake of IPPB Services
Location: New Delhi, Delhi
Timeline: November, 2019 – March, 2020
Thematic Area: Financial Inclusion
Implementation Partners: India Post Payments Bank (IPPB) and Bill and Melinda Gates Foundation (BMGF)
CSBC Team: Aditya Laumas, Pritha Sengupta, Sita Sanjivini and Tirtha Patel