Postal department to spin off life insurance business into a separate unit

Postal department to spin off life insurance business into a separate unit

The postal department plans to spin off the postal life insurance and rural postal life insurance operations into a separate business unit (SBU) for which a Cabinet note has been circulated, Communications Minister Manoj Sinha said Wednesday.

"For postal life insurance and rural postal life insurance, we have moved a Cabinet note. In the first phase it will involve the creation of an SBU and in the second phase a full-fledged insurance company," Sinha told reporters on the sidelines of an event to mark the second-anniversary celebration of India Post Payments Bank (IPPB).

The minister hoped that the Cabinet approval would be received in next fortnight or so.

Sinha said IPPB has rolled out 1.26 lakh access points over the last five months and in the next week or 10 days the number is expected to rise to 1.36 lakh.

Nearly 800 access points are being opened by IPPB every day and the payments bank has over 30 lakh customers availing banking services. Twenty-one lakh transactions have been performed valued at over ₹800 crore.

Over 1 lakh post office savings bank customers are availing inter-operable banking service by linking their post office savings account to IPPB account. Further, the IPPB mobile banking application has witnessed over 8 lakh downloads.

At present, the postal department offers one of the oldest life insurance schemes — Postal Life Insurance (PLI), which was introduced in 1884. Since March 1995, Rural Postal Life Insurance (RPLI) has been providing insurance cover to people residing in rural areas, especially weaker sections and women living in rural areas.

Speaking on the occasion, Finance Minister Piyush Goyal said the IPPB would help enhance customer literacy about finance and the financial world by leveraging on the connection between the postman and a customer.

"The simple and smart methodology of providing delivery to customers, the way they have been able to use databases, the way UPI is being modified to be accessible for all the people without any need of a smartphone, without remembering the account number, will truly revolutionize banking," Goyal said.

He said India is leading the world in showcasing easy and accessible banking. "I suspect no other part of the world has focussed much on providing this kind of easy and simple banking".