A SUMMER TRAINING PROJECT REPORT

ON

A Study on Customers Preferences for India Post Payments Bank in

Varanasi (Visheshwarganj)

Submitted for the partial fulfillment in third semester course of

MASTER OF BUSINESS ADMINISTRATION
(Session – 2023-2024)

SUBMITTED BY:-. Under the guidance of:-

Shivam Maurya Mr. Sublesh Singh
Roll no.- 2206410700041 Senior Manager of IPPB

Submitted to:-
DEPARTMENT OF BUSINESSADMINISTRATION
ASHOKA INSTITUTE OF TECHNOLOGY AND MANAGEMENT
Affiliated to Dr. A.P.J. Abdul Kalam Technical University, Uttar Pradesh, Lucknow

Signature of Internal Examiner:- Signature of External Examiner:-

1
 Project Certificate Forwarded by Supervisor

This is to certify that Shivam maurya, is a regular student of MBA 2nd year,
and had successfully completed his summer training project entitled Customers
Preferences for India Post Payments Bank in Varanasi (Visheshwarganj) for
partial fulfilment of the curriculum for the award of the degree of Master of
Business Administration from Dr. A.P.J. ABDUL KALAM TECHNICAL
UNIVERSITY, LUCKNOW, is an original work done by him.

Guided By
Mr. Shublesh Kumar Singh
(Senior Manager, IPPB Varanasi Branch)

2
 Declaration
I, Shivam Maurya, hereby declare that the report entitled "India Post
Payments Bank" is a Training work carried out by me independently. The
information presented done is correct to the best of my knowledge and the
analysis is as per the norms and guidelines provided for the report. I have utilized
the requisite concepts and applied the required methodologies to analyze the data
collected to reach the conclusion present in the report.

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 Acknowledgement
I consider it a privilege to express a few words of gratitude and respect to all who guided and
inspired me in successful completion of this project.

I am overwhelmed with pleasure to express my gratitude towards Mr. Sublesh Singh

(Senior Manager) of IPPB for granting this project to me and givingan opportunity to work
with such an esteemed organization.

It is my sincere duty to do my best so as to recognize as one amongst the most successful

professional, which I always strive to be .This bring along and frame to my beloved
institution, the ASHOKA INSTITUTE OF TECHNOLOGY & MANAGEMENT.

I also extend particular thanks to our Project Guide Mr.Vinay kumar Tiwari for guiding me
in my project. I would also like to thank all the teaching and non teaching staff member and
all others who helped me directly or indirectly in the successful completion of this project.

There is no love like parents. I pay my most sincere regards to my parents deserves a very
special word of appreciation for their invaluable support encouragement and pains taking
efforts without which this goal would have been a much difficult.

Date: Shivam Maurya

Place: Varanasi MBA 3rd Semester
Roll no: 2206410700041

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 TABEL OF CONTENT
1. Industry Profile/Company profile PAGE NO

2. Objective of the study

3. Scope of the study

4. Introduction to the topic

5. Methodology on data collection

6. Data analysis

7. Findings

8. Limitations

9. Suggestions

10. Conclusion

11. Appendices

12. Bibliography

13. References

14.

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CHAPTER 1

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 Introduction to Indian banking system

India is one of the fastest-growing economies in the world, and its banking sector
has played a critical role in this growth. The Indian banking sector has undergone
a significant transformation in recent years, with the introduction of new
technologies, increased foreign investment, and regulatory reforms. The sector
comprises various types of banks, including public sector banks, private sector
banks, cooperative banks, and foreign banks. With a vast network of branches
spread across the country and a growing customer base, the Indian banking sector
has become a crucial component of the country's financial infrastructure. In this
article, we will provide an overview of the Indian banking sector.

Modern banking in India originated in the mid of 18th century. Among the
first banks were the Bank of Hindustan, which was established in 1770 and
liquidated in 1829–32; and the General Bank of India, established in 1786 but
failed in 1791.

The largest and the oldest bank which is still in existence is the State Bank of
India (SBI). It originated and started working as the Bank of Calcutta in mid-
June 1806. In 1809, it was renamed as the Bank of Bengal. This was one of the
three banks founded by a presidency government, the other two were the Bank of
Bombay in 1840 and the Bank of Madras in 1843. The three banks were merged
in 1921 to form the Imperial Bank of India, which upon India's independence,
became the State Bank of India in 1955. For many years, the presidency banks
had acted as quasi-central banks, as did their successors, until the Reserve Bank
of India[5] was established in 1935, under the Reserve Bank of India Act, 1934.
7
In 1960, the State Banks of India was given control of eight state-associated
banks under the State Bank of India (Subsidiary Banks) Act, 1959. How ever the
merger of these associated banks with SBI went into effect on 1 April 2017. In
1969, the Government of India nationalised 14 major private banks; one of the
big banks was Bank of India. In 1980, 6 more private banks were nationalised.
These nationalised banks are the majority of lenders in the Indian economy. They
dominate the banking sector because of their large size and widespread networks.

The Indian banking sector is broadly classified into scheduled and non-scheduled
banks. The scheduled banks are those included under the 2nd Schedule of the
Reserve Bank of India Act, 1934. The scheduled banks are further classified into:
nationalised banks; State Bank of India and its associates; Regional Rural
Banks (RRBs); foreign banks; and other Indian private sector banks. The SBI has
merged its Associate banks into itself to create the largest Bank in India on 1
April 2017. With this merger SBI has a global ranking of 236 on Fortune 500
index. The term commercial banks refers to both scheduled and non-scheduled
commercial banks regulated under the Banking Regulation Act, 1949.

Generally the supply, product range and reach of banking in India is fairly
mature-even though reach in rural India and to the poor still remains a challenge.
The government has developed initiatives to address this through the State Bank
of India expanding its branch network and through the National Bank for
Agriculture and Rural Development (NABARD) with facilities
like microfinance.

History of Indian Banking Sector

The evolution of the Indian banking sector dates back to the late 18th century, when the
General Bank of India was established in 1786. Since then, the sector has undergone several
significant transformations and has played a pivotal role in the country's economic
8
development. Following is a timeline of some of the critical events that shaped the Indian
banking sector:

o 1806: The Bank of Calcutta was established, followed by the Bank of Bombay (1840)
and the Bank of Madras (1843), which together formed the presidency banks.
o 1921: The Imperial Bank of India was established after the amalgamation of the three
presidency banks.
o 1935: The Reserve Bank of India (RBI) became operational as the central bank of the
country.
o 1949: The Banking Regulation Act gave the RBI extensive regulatory powers over
banks.
o 1969: The government nationalized 14 major commercial banks.
o 1980: Six more commercial banks were nationalized, taking the total number of
nationalized banks to 20.
o 1991: Economic liberalization led to the entry of private and foreign banks in the
Indian banking sector.
o 1993: The Securities and Exchange Board of India (SEBI) was established to regulate
the securities market in India.
o 2000: The National Stock Exchange of India (NSE) was set up, becoming the largest
stock exchange in India in terms of market capitalization.
o 2002: The RBI introduced the concept of internet banking, allowing customers to
perform banking transactions online.
o 2015: The Pradhan Mantri Jan Dhan Yojana, a financial inclusion program aimed at
providing banking services to the underprivileged sections of society, was launched by
the government.

These events trace the history of the Indian banking sector, which has continuously adapted
to changing times and evolving customer needs.

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Small finance banks
To further the objective of financial inclusion, the RBI granted approval in 2016
to ten entities to set up small finance banks. Since then, all ten have received the
necessary licenses. A small finance bank is a niche type of bank to cater to the
needs of people who traditionally have not used scheduled banks. Each of these
banks is to open at least 25% of its branches in areas that do not have any other
bank branches (unbanked regions). A small finance bank should hold 75% of its
net credits in loans to firms in priority sector lending, and 50% of the loans in its
portfolio must be less than ₹25 lakh (US$34,000).[66]

Payment Banks
Payments bank is a new model of banks conceptualized by the Reserve Bank of
India (RBI). These banks can accept a restricted deposit, which is currently
limited to ₹2 lakh per customer. These banks may not issue loans or credit cards,
but may offer both current and savings accounts. Payments banks may issue
ATM and debit cards, and offer net-banking and mobile-banking. The draft
guidelines for licensing of payments banks in the private sector were formulated
and released for public comments on 17 July 2014. The banks will be licensed as
payments banks under Section 22 of the Banking Regulation Act, 1949, and will
be registered as public limited company under the Companies Act, 2013.

Types of Banks in the Indian Banking Sector

The Indian banking sector is composed of several types of banks, each with
different ownership structures and operational characteristics. The types of banks
in the Indian banking sector include:

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Central banks: The Reserve Bank of India (RBI) is the central bank of India
and is responsible for regulating the banking sector, managing monetary policy,
and maintaining financial stability. It is also responsible for printing currency
notes, managing foreign exchange reserves, and providing banking services to
the government.

Commercial banks: Commercial banks are the most common type of banks
in India and offer a wide range of financial services to individuals, businesses,
and other organizations. They include public sector banks, private sector banks,
and foreign banks.

Public sector banks: These are banks in which the government has a majority
stake, and they are also referred to as nationalized banks. They were established
with the objective of promoting financial inclusion and providing banking
services to all sections of society.

Private sector banks: These are banks owned by private individuals or

corporations. They are divided into two categories: old private sector banks,
which were established before liberalization, and new private sector banks,
which were established after liberalization.

Foreign banks: These are banks that are headquartered outside India but have
a presence in India. They are regulated by the Reserve Bank of India and must
comply with Indian banking laws and regulations.

Cooperative banks: These are banks that are owned and operated by
members of a cooperative society, usually with a common interest or purpose.

11
They are further divided into two types: urban cooperative banks and rural
cooperative banks.

Regional Rural Banks: RRBs were established with the objective of

providing banking services to the rural areas of India. They are jointly owned by
the central government, state government, and sponsor banks (i.e., public sector
banks).

Specialized/Development banks: There are various types of specialized

banks in India that cater to specific sectors or industries. For example, the
National Bank for Agriculture and Rural Development (NABARD) provides
financial services to the agricultural sector, while the Small Industries
Development Bank of India (SIDBI) provides financial services to small and
medium-sized enterprises (SMEs).

Payment banks: Payment banks are a new category of banks in India that
were introduced with the objective of increasing financial inclusion and
providing basic banking services to underserved segments of the population.
They can accept deposits up to Rs. 2 lakh and offer services such as remittance,
mobile payments, and ATM/debit cards.

Services offered by the Indian Banking sector

The Indian banking sector offers a wide range of services to its customers, from
individuals to large and small businesses. Following are some of the main
services offered by the banking system of India:

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Deposits: Banks offer various types of deposit accounts, such as savings
accounts, current accounts, fixed deposit accounts, recurring deposit accounts,
and tax-saving deposit accounts. These accounts provide a safe place to deposit
money and earn interest on the amount.

Loans: Banks provide various types of loans, such as home loans, car loans,
personal loans, education loans, and business loans. These loans help individuals
and businesses meet their financial needs and goals.

Credit cards: Bank-issued credit cards allow individuals to make purchases on

credit and pay back the amount over time or on an agreed upon date. Credit cards
also offer rewards and cashback on transactions.

Debit cards: debit cards allow individuals to withdraw cash from ATMs and
make purchases using the card's balance. Debit cards are linked to a savings or
current account and are used to access and make payments directly from the
funds in the account.

Online and mobile banking: These are services that allow customers to access
their accounts, transfer funds, pay bills, and make other transactions from the
convenience of their homes or mobile devices. For example, Real-Time Gross
Settlement (RTGS), National electronic Fund Transfers (NEFT) etc.

Investment products: Banks offer various investment options, such as mutual

funds, insurance products, and fixed deposits, that help individuals grow their
wealth and meet their long-term financial goals.

13
Forex and remittance services: the banking sector offers foreign exchange and
remittance services that allow individuals and businesses to send and receive
money from across borders.

Trade finance services: trade finance services, such as letters of credit, bank
guarantees, and export financing, help businesses engage in international trade.

Challenges faced by the Indian Banking System

The Indian banking system faces several challenges that can impact its growth
and stability. Some of the main challenges faced by the Indian banking system
have been illustrated below:

1. Non-performing assets: The problem of NPAs, or bad loans, is a major

challenge faced by the Indian banking system. NPAs arise when borrowers
fail to repay their loans, leading to a significant impact on banks'
profitability and liquidity.

2. Cybersecurity risks: As the banking sector becomes increasingly

digitized, the risk of cyber attacks and data breaches has become a major
concern. Banks need to invest in robust cybersecurity measures to protect
their systems and customer data.

3. Regulatory compliance: The Indian banking sector is highly regulated,

with several laws and regulations that banks must comply with. Ensuring
compliance with these regulations can be a complex and time-consuming
process.
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 4. Competition from new players: The Indian banking sector is witnessing
increased competition from new players, such as payment banks and
fintech companies. These players are leveraging technology to offer
innovative products and services, challenging the traditional banking
model.
5. Financial inclusion: Despite significant progress in recent years, financial
inclusion remains a challenge in India. A large segment of the population,
especially in rural areas, still lacks access to basic banking services.
6. Skilled workforce: Banks require a skilled and experienced workforce to
manage their operations and offer high-quality services to customers.
However, many banks struggle to attract and retain talented professionals.

A-Z List of Banking Terminologies

The below section covers a full list of banking Terminologies starting from A up to Z.

Account- It refers to the running record of transactions that take place between
two parties. In the banking sector, the two individuals are the banks and the
customers. Simply put, it is the account of nominal interest.

15
ATM (Automated Teller Machine)- ATMs are machines that help in
dispensing and/ or receiving cash, accepting deposits, checking details of bank
balance, etc.

Annuity- It is the fixed amount of money that is paid to somebody each year,
usually for the rest of his/ her life.

Assets- It is a resource with economic value that an individual, corporation, or

country owns or controls with the expectation that it will provide benefits in
future.

Bailout- It is done to rescue the company facing financial difficulties at an

extreme level

Balance Sheet- It is a financial statement that reports a company’s assets,

liabilities, and shareholders’ equity at a specific point in time, and provides a
basis for computing rates of return and evaluating its capital structure

Bank Credit- It refers to the lending by banks to customers through various

means such as loans, discounting of bills of exchange, etc

Bank deposits- It is opposite to the bank credit. It implies to depositing own

savings with the banks for various purposes ranging from safety to earning
interest

Banknote- A note issued by the bank promising to pay a certain specified

amount of money when being presented

Bank Rate- It is the rate of interest charged by a central bank to commercial

banks on the advances and the loans it extends.It is also the rate of discount at

16
which the Reserve Bank of India (RBI) discounts the first-class bills. Bank rate is
one of the quantitative methods of monetary policy.

Bankruptcy- It is a legal process through which people or other entities cannot

repay debts to creditors and may seek relief from some or all of their debts.

Bridge Loan- It is a loan made by the bank for a very short period to make up
for the temporary shortage of cash

Bancassurance- It refers to the distribution of insurance products and the

insurance policies of the insurance companies by the banks as corporate agents
through the bank’s branches.Banks generally charge a fee for this service from
insurance companies.

Bouncing of a cheque- It is a situation when an account has insufficient funds

and any type of cheques is not payable and thus returned by the bank with a
reason “Exceeds arrangement” or “funds insufficient”

Base Rate- It is the rate of interest on which the banks generally base their
lending rates. It is seen that the loans are given at a rate higher than the base rates
and the saving rate is below the base rate.

Basis point- It is one-hundredth of 1% point which is normally used for

indicating the cost of finance

Bills of exchange- According to section 5 of the Negotiable Instruments Act of

1881, a bill of exchange is an instrument in writing containing an unconditional
order signed by the maker, directing a certain person to pay a certain amount of
money, only to, or to the order of, a certain person, or the bearer of the
instrument.

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Call Money- It is a loan that is made available for a very short period of a few
days only with a low rate of interest.

Capital Assets- The asset which is not bought or sold as part of the everyday
running of the business

Cash- It refers to that money which is in the form of banknotes and/ or coins

Capital Expenditure- Non Recurring nature of expenditure is used in

purchasing of capital assets.

Cash cow- Those enterprises that yield high earnings but often have low growth
potential

Cheque- It is written by an individual to transfer an amount between two

accounts of the same and/ or different bank

Core Banking- It is a general term used to describe the services provided by a

group of networked bank branches

Core Banking Solutions (CBS)- In CBS, all the branches of the bank are
connected and the customer can access their funds and/ or transactions from any
other branch.

Cash Reserve Ratio (CRR)- It refers to the number of funds that a bank has to
keep with the Reserve Bank of India (RBI).If the percentage of CRR increases,
then the amount with the bank cosem down and vice versa.

Current Account- It is an account that can be opened generally for business

purposes with no restrictions on withdrawals and no interest paid

Cash Discount- It is the discount given at the time of payment

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Cash flow- It refers to the movement of money into and out of a business as
goods are bought and sold

Cheap money- It is a loan or credit with a low-rate interest ro the setting of low-
interest rates by the RBI

Certificate of Deposit- It is the certificate issued by a bank to a person

depositing money for a specified length of time at a specified rate of interest

Collateral Security- It is the asset which a borrower is required to deposit with

or pledge to a lender as a condition of obtaining a loan which can be sold off if
the loan is not repaid

Commercial Banks- They are a financial institution that accepts deposits, offers
checking account services, extends various loans, and offers basic financial
products like the certificate of deposits, and savings accounts to individuals and
small businesses.

Credit Card- It is a payment card issued to the users to enable the cardholder to
pay a merchant for goods and services based on the cardholder’s promise to the
card issuer to pay them for the amounts plus the other agreed charges

Crossing the Cheque- It is instructing the banker to pay a specified sum through
the banker only, that is, the amount on the cheque has to be deposited directly to
the bank account of the payee

Debit card- It is a card issued by the bank so that the customers can withdraw
their money from their account through digital banking.

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Demat Account- It refers to how a bank keeps money in a deposit account in the
same way the depository company converts share certificates into electronic form
and keep them in a demat account

Dishonour of Cheque- It refers to the non-payment of a cheque by the paying

banker with a return memo giving reasons for non-payment

E-banking- It is a type of banking in which individuals can conduct financial

transactions digitally. RTGS, Credit cards, debit cards, UPI, etc. are included in
e-banking

EFT (Electronic Fund Transfer)- Under this, an ATM, wire transfer, and
computers are used to move funds between different accounts in the different
and/ or the same bank

Fiscal deficit- It is the number of funds borrowed by the government to meet the
expenditures

Finance- It is a term for matters regarding the management, creation, and study
of money and investments

Flat money- It is a currency established as money, often by government

regulation that does not have an intrinsic value

Hot money- It is capital that investors regularly move between economies and
financial markets to profit from the highest short term interest rates

Hypothecation- It is the practice where a debtor pledges collateral to secure a

debt or as a condition precedent to the debt, or a third party pledges collateral for
the debtor.A letter of hypothecation is the usual instrument for carrying out the
pledge.

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Idle Money- It is the money that has not been invested and is therefore not
earning interest or investment income of any kind.

Insolvency- It is a state of financial distress in which a person or business is

unable to pay its debts.

Interest- It is the payment form a borrower or deposit-taking financial institution

to a lender or depositor of an amount above repayment of the principal sum, at a
particular rate.

Inflation- It is an increase in the quantity of money in circulation without any

corresponding increase in goods, resulting in an abnormal rise in the price level.

Initial Public Offering (IPO)- It refers to the time when a company makes the
first offering of the shares to the public.

Kiosk Banking- It refers to doing banking from a cubicle from which food,
newspapers, etc. are also sold.

Leverage Ratio- It is a financial ratio that gives an idea or a measure of a

company’s ability to meet its financial losses.

Letter of Credit- A letter issued by the bank to another bank (especially one in a
different country) to serve as a guarantee for payments made to a specified
person under specified conditions.

Liabilities- It is something a person or a company owes, usually a sum of money

Lien- A right to keep possession of property belonging to another person until a

debt owed by that person is discharged

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Liquid Assets- It is an asset that can be easily converted into cash in a short
duration of time.

Liquidity- It is the ability to convert an investment quickly into cash without any
loss in its value.

Lease- A legal agreement that allows the use of a building or land for a fixed
period in return for a rent.

Market Capitalization- It is the product of the share price and the number of the
company’s outstanding ordinary shares.

Mortgage- It is a kind of security which one offers for taking an advance or loan
from a lender.

Mutual Fund- These are investment schemes that help pool money from various
investors to purchase securities.

Microfinance- It is a category of financial services targeting individuals and

small businesses that lack access to conventional banking and related services.

Monetary Policy- It refers to the central bank policy concerning the money in
the economy, the rate of interest, and the exchange rate.

Non Performing Assets (NPAs)- They are the loans given by a bank on which
repayments and/ or interest payments are not being made on time.

Near Money- Near or quasi money consists of highly liquid assets that are not
cash but can easily be converted into cash.

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Negotiable Instruments- It is a document guaranteeing the payment of a
specific amount of money, either on demand or at a set time, whose payer is
usually named on the document.

Overdraft- It occurs when money is withdrawn from a bank account and the
available balance goes below zero. In such a situation, the account is said to be
“overdrawn”

Permanent Account Number (PAN)- It is a number issued by the Income Tax

department to the taxpayers

Plastic Money- It is a name given to credit cards, ATM cards, debit cards, and
international cards issued by the banks.

Point of Sale (PoS)- It refers to a location at which payment of a card transaction

occurs.

Prime Lending Rate (PLR)- It is the rate of interest at which a bank gives a
loan to its most reliable customer, that is, a customer with ‘zero risks’.

Pass Book- It is a book where all the bank transactions are recorded. They are
mainly issued to current or savings bank account holders.

Repo Rate- It is seen that the commercial banks borrow funds from the RBI if
there is any shortage in their reserves. If the REPO rate increases, it becomes
expensive to borrow money from the RBI and vice versa.

Reverse Repo Rate- It is the opposite of repo rate as it is the rate at which the
RBI borrows money from the banks when it observes that too much money is
floating in the banking system.

23
Special Drawing Rights (SDR)- It is a reserve asset (Paper Gold) created within
the framework of the IMF in a bid to increase international liquidity.

Teller- It is a staff member of the bank who cashes cheques, accepts deposits,
and performs various banking services for the bank’s customers.

Universal Banking- When financial institutions and banks undertake activities

related to banking, like an investment, issue of debit and/ or credit card, etc. then
it is generally known as universal banking.

Virtual Banking- Internet banking is also called virtual banking as there are no
bricks or boundaries involved. It is mainly operated by the internet.

Wholesale Banking- It is similar to retail banking with a slight difference that it

is mainly focused on the financial needs of the institutional clients and the
industry.

Zero Coupon Bond- They are sold at a good discount as they have no coupon.

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 Classification of bank in india

25
 Introduction to IPPB Bank

At India Post Payments Bank, we believe that a nation can grow when every
citizen has an opportunity to prosper, regardless of their way of life. With simple,
diverse and growth-oriented offerings, IPPB aims to provide every household in
India an access to efficient banking services and enable them to become
financially secure and empowered.

India Post Payments Bank (IPPB) was setup under the Department of Post,
Ministry of Communication with 100% equity owned by Government of India.
IPPB was launched as a pilot project on 30 January 2017 in Ranchi (Jharkhand)
and Raipur (Chhattisgarh), with the objective of being present across India by the
FY 2018-2019. IPPB has expanded its strength across India covering post
offices, through a network one Branch and 649 Banking outlets manned by
Business Correspondents, working on a hub and spoke model.

The India post payment bank started in 1st September 2018, owned by the Indian
government. India post payment bank started by Prime Minister Narendra Modi.
India post payment bank undertaken by the Indian post offices. The payments
bank money will be provide by the Reserve Bank of India. The India post
payment bank will be linked to the 155000 Indian post offices. The payments
bank offered by the current and savings account, money transfer, direct benefit
transfer. This type of payment bank will be provide the counter services, online
banking, atm cards, mobile banking apps.

History
On 19 August 2015, the India Post received licence to run a payments bank from
the Reserve Bank of India. On 17 August 2016, it was registered as a public
26
limited government company for setting up a payments bank.IPPB is operating
with the Department of Posts under Ministry of Communications.

The pilot project of IPPB was inaugurated on 30 January 2017

at Raipur and Ranchi. In August 2018, the Union Cabinet approved a cost
of ₹1,435 crore (US$180 million) for setting up the bank.The first phase of the
bank with 650 branches and 3,250 post offices as access points was inaugurated
on 1 September 2018. Over ten thousand postmen have been roped into the first
phase. By September 2020, the bank had acquired about 3.5 crore customers.The
bank had acquired about 4 crore customers by December 2020. In January 2022,
India Post Payments Bank has crossed 8 crore customers mark.

Introducing an easier and quicker way of opening an online account with IPPB’s
digital savings account! That's right, no more paper work is required. One can
enjoy a range of best digital savings account services on their mobile phone. The
process is simple – the applicant needs to download our mobile app enter his/her
PAN number, Aadhaar number and start banking with us.

Here's how it started:

September 2015
Department of Post Receives in-principal approval from RBI to set up payments
bank.

January 2016
PBI division of DoP earmarks Rs. 800 crore funding amount for IPPB

27
August 2016
India Post Payments bank incorporated on 17th August 2016 as a 100%
Government of India owned bank under the Department of Posts

January 2017
Receives Payments bank license from Reserve Bank of India (RBI)
IPPB started its operations on 30th January, 2017 by opening two pilot branches,
Raipur and Ranchi.

1.2 Vision & Mission of IPPB

IPPB’s Vision:

Building the most accessible, affordable and trusted bank for the common man.

IPPB’s Mission:

Spearheading financial inclusion by removing barriers and reducing costs for

accessing banking services.

Indian Post Payments Bank with the vision of building the most affordable,
accessible, and trusted bank for the common man and driving the agenda of
financial inclusion for the under-banked population will be governed by RBI.

Though the services of Indian Post Payments Bank is for all the citizens; the
primary focus of IPPB is serving the low-income households, social sector
beneficiaries, unorganized sector, migrant laborers, MSMEs – Micro Small and

28
Medium Enterprises, and Panchayats in rural areas also the under-banked and
unbanked segments in both the urban and rural areas.

IPPB offers services through a mix of physical and digital platforms. Channels
used for delivering IPPB services include:

 Doorstep, mobile and internet banking (three pillars of IPPB)

 Counter operations
 Pre-paid instruments such as PoS, mobile wallets, MPoS, etc.
 ATMs/micro ATMs

1.3 Services of IPPB Bank

Postman/GDS( Gramin Dak Sewas) Services

IPPB offers banking services in rural, semi-urban and urban areas through
Doorstep banking services, powered by an efficient network of Postman/GDS.
As a customer, you can avail the Doorstep banking services at your
communication address, be it residential or shop/business.

Features and Benefits

 Easy, Convenient and paperless account opening

 You can choose a time slot of your convenience for Doorstep banking
 Takes financial inclusion to the last mile of the nation/Enables banking
even in the most remote areas in the country

29
Services provided by the GDS/Postman

Customer On-boarding

The GDS/Postman will open your requested type of account by visiting your
registered address. You can open any of the following accounts using this
service:

 Basic savings account

 Regular savings account
 Salary account
 Current account (This type of account can be opened in addition to any one
of the above three accounts)

Merchant On-boarding

 You can open a current account and avail Merchant Services through our
Postman/GDS at your doorstep
 Once on-board, you can enjoy digital payment acceptance solutions and
manage your day-to-day business activities efficiently

Account Services

 Cash deposit and withdrawals

 Instant money transfers
 Easy money transfer to your own as well as to other IPPB accounts
 Bill payments

30
  Account modification
 Domestic Money Transfer services for IPPB and Non-IPPB customers

Third Party Products

 Third-party insurance – Group term insurance

 Payments of DoP products like PPF, SSA, Rd and LARD
 Issuance of Digital Life Certificate

Other Account-Related Services

 Update PAN and nominee details

 Beneficiary management
 Request for account statement and related reports
 Add/delete standing instructions
 QR card re-issuance
 Aadhaar linking
 Share Complaints/Feedback with the GDS/Postman
 Upgrade Account and Update personal details through our Doorstep
banking services
 Avail the facility of sweep-in and sweep-out at your doorstep

31
 CHAPTER 2

32
Customers Preferences for India Post Payments Bank
As of my last knowledge update in January 2022, India Post Payments
Bank (IPPB) was a government-operated financial institution in India
that aimed to provide banking and financial services to the unbanked
and underbanked population. However, specific customer preferences
can vary based on individual needs and experiences. Here are some
general factors that might influence customer preferences toward IPPB
or any similar institution:
Accessibility and Reach: Customers may prefer IPPB due to its extensive
reach, especially in rural and remote areas where traditional banking
infrastructure is limited. The ability to access banking services easily
can be a significant factor for customers.
2. Low-Cost Services: If IPPB offers low-cost or no-frills banking
services, it may attract customers who are price-sensitive or looking for
affordable financial solutions.
3. Financial Inclusion: IPPB's mission is to promote financial inclusion
by providing banking services to the unbanked. Customers who were
previously excluded from the formal banking sector might prefer IPPB
for the opportunities it provides to access banking services.
4. Simplified Account Opening: If IPPB offers a straightforward and
simplified account opening process, it could appeal to customers who
find traditional banks' procedures cumbersome.
5. Digital Services: The convenience of digital banking services, such
as mobile banking and online transactions, can be a significant factor
33
for tech-savvy customers. If IPPB provides user-friendly digital
platforms, it may attract customers who prefer conducting transactions
online.
6. Trust in Government: Some customers may have a preference for
government-backed financial institutions due to a perceived sense of
security and trust in the regulatory environment.
7. Customer Service: The quality of customer service, including
responsiveness and problem resolution, can greatly influence customer
preferences.
8. Financial Literacy Initiatives: If IPPB conducts educational
programs or initiatives to enhance financial literacy, it may attract
customers who value such efforts and want to improve their
understanding of financial matters.

34
 CHAPTER 3

35
 Objective of the study

 To study the customers preferences for postal banking services.

 To study the supply of banking services influencing customer

preference.

 to study the need of technology for delivering banking services.

 To highlight the preferences of rural and urban customers between

cash or digital mode of payment.

36
 CHAPTER 4

37
 SCOPE OF THE STUDY
The scope of research for the above study is Post office branch Visheshwarganj
district Varanasi . Varanasi district is vast and densly populated hence it is not
possible to cover the entire Thane district. The researcher has conisdered
certain variables for particular research like age of customer, income, eductation
of respondents, customer needs,availability of basic banking services, timeliness
of services, quality of banking services, safety, security, use of technology,
expectations of customers, easy accesssibility of banking services etc these
fatcors are The researcher has tried to find out research problem and tried to
find the solution for the same.

This study examines the perception of the customers towards financial services
in post offices by using various appropriate statistical techniques and tools.

The study also helps to create awareness among the investors about various post
office deposits schemes. On basis of the study, the Government can make
38
suitable changes to promote the various post office saving schemes according to
the respective needs of the investors. Hence there is a wide scope for conducting
this research in Varanasi district.

Chapter 5

39
Research methodology
Research is a scientific and systematic research for patent information on
a specific topic.
Data Collection and Sampling Method The above research is conducted in Varanasi region
which is geographically vast and densly populated and hence the study of customer
preferences has been done by conducting survey of 150 customers in Varanasi District. The
primary data is collected through questionnaire which is given to the respondents of
Varanasi city and district. Secondary data is collected through the various books, research
jornals and websites. Simple random sampling method is used to collect the responses of
respondents to make the sample representative. Simple Random sampling is scientific
sampling method. Data is collected by personally visiting the postal banks.
40
D e s c r i p t i v e re s e a rc h : -
descriptive research defines questions people survey and the method of analysis
prior tobeginning data collection in other word the Who what where when why I
and how aspects ofthe research should be defined. such preparation allows one
the opportunity to make anyrequired changes before the costly process of
Data Collection has begun.

Data Analysis and Interpretation

The factors influencing customer preferences for postal banking

Agree Neutral Disagree

Detailed information about the postal banking 70% 2% 28%

servives is available on web site
Easy to choose and compare variety of 82% 4% 14%
services
Time Saving and Convenient compared to 6% 3% 91%
banking services
Facilitates easy banking services 83% 6% 11%

Reduces the cost and efforts of visiting bank 76% 8% 16%

Provides necessary security 88% 4% 8%

Trustworthy websites /portals 85% 6% 9%

Good rates of interest are offered compared 12% 10% 78%

to banking services
All the needs of customers are considered 45% 10% 45%

41
Wide variety of services are available online 68% 4% 28%

Quality of services is satisfactory 71% 10% 19%

Trained staff members are providing postal 45% 20% 35%

banking
Technology improvement is necessary 65% 25% 10%

Hypotheses Testing
Ho- The customer preferences for postal banking services are not significantly
influenced by supply of banking services.
H1- The customer preferences for postal banking services are significantly
influenced by supply of banking services.
The above hypothesis is tested using Chi square test. The significance level is less than 5%
it is proved that the customer preferences for postal banking services are significantly
influenced by supply of banking services.
Supply of Banking Services and Chi Square Value-25.14
Customer Preferences

So it can be inferrred that Null Hypothesis is rejected and it is proved that Customer
Preferen\ces are significantly influenced by Supply of banking services.
H0-There is no significant relationship between technology and customer preference
towards postal banking.
H1-There is a significant relationship between technology and customer preferences
towards postal bankig.
The above hypothesis is tested using Chi square test. The significance level is less than 5% it
is proved that there is a significant relationship between technology and customer
preferences.

42
Relationship between technology and Chi square value-35.14
customer preferences for postal
banking

So it can be inferrred that Null Hypothesis is rejected and it is proved that there is a
significant relationship between technology and customer preferences.

43
 CHAPTER 6

44
DATA ANALYSIS AND INTERPRETATION

GENDER-WISE CLASSIFICATION

Particulars No. of Respondents

Male 112
Female 86
others 2
Total 200

Gender

1%

Male
43%
Female
56%
others

Interpretation

The data shows that the respondents were composed of 56% male, 43% female
and 1% others. it can be inferred that majority of the respondents are male,
compared to 86 female and 2 others, in a total of 200

45
 AGE-WISE CLASSIFICATION
Particulars No.of respondent
Below 25 40
Between 25 and 50 35
Between 50 and 60 15
Above 60 10
Total 100

45
40
35
30
25
20
15
10
5
0
Below 25 Between 25 and 50 Between 50 and 60 Above 60

Interpretation

The Table shows that out of 100, 37% of respondents fall under the age of 0-
25,40% of the respondents fall under the age group below 25, 15% of the
respondents fall under the age group of 50-60 and 10% of the respondents fall
under the age group above 60. The majority respondents are of the age between
below 25.

46
 CLASSIFICATION ON THE BASIS OF
OCCUPATION

Particulars no.of Respondents

Agriculturist 25
Business or Profession 15
Salaried class 20
Student 30
Others (retired, home makers, etc) 10
Total 100

Interpretation
The Table show that out of 100, 25% of respondents are agriculturist, 15% of the
respondents are in the business and professional field, 20% of the respondents are
salaries class, 30% of respondent are the student and 10% of the respondents are
others. The majority respondents are students

CLASSIFICATION ON THE BASIS OF PUBLIC

AWARENESS ON IPPB
47
 Particulars No.of Respondents
yes 66
no 34
total 100

34%

yes
66%
no

Interpretation

The Table shows that out of 100 respondents, 66% of the respondents are aware
about India Post Payments Bank services and 34% of the respondents are not
aware about the service. It can be inferred that majority of the respondents are
not aware about the service.

Classification on the basis of all services provided

Services no.of respondents
Mobile banking 30
sms banking 10
missed call banking 5
phone banking 55

48
 total 100

55

30

10
5

MOBILE SMS BANKING MISSED CALL PHONE

BANKING BANKING BANKING

Interpretation

When asked for the preference of people regarding IPPB Bank services 30% of
tthe response where service to be using the Mobile banking of IPPB bank where
as 10%were using SMS banking and 5% were using Missed call banking and
55% the oneswho were connected to phone banking.

TYPE OF ACCOUNTS HELD BY THE

RESPONDENTS
Particulars No.of respondents
Saving account 40
Recurring Account 20
Term Deposit Account 8
Public Provident Account 10
Kisan Vikas Patra 20
Others 2
total 100

49
Interpretation

The Table shows that out of 100 respondents, in which 40% belongs to Savings
Account category, 20% belongs to Recurring Account category, 8% belongs to
Term Deposit Account category, 10% belongs to Public Provident Fund Account
category, 20% belongs to Kisan Vikas Patra category and 5% belongs to others.
The majority of the respondents are holders of Savings Account.

Classification on the basis of sources of awareness

on IPPb
Particulars No.of Respondents
Advertisement 40
Friends and Families 30
agents 30
Total 100

50
 40
35
30
25
20
15
10
5
0

Advertisement No.of Respondents

Friends and
Families agents

Interpretation

The Table shows that out of 100 responds, 40% of the respondents have been
aware of IPPB through the help of advertisements, 30% of the respondents have
an account with IPPB through friends and families and 30% of the respondents
got awareness from agents of IPPB. Majority of the respondents got the
awareness through friends and families.

51
 CLASSIFICATION ON THE BASIS OF HOW
THE STAFFS RESPOND TO THEIR
CUSTOMERS

Particulars No.of respondents

Friendly 75
Lae Responds 19
Indifferent Approach 5
Any other 1
Total 100

Friendly
Lae Responds
Indifferent Approach
Any other

Interpretation

The Table shows that out of 30 Respondents, 75 respondents find the staffs are
friendly, 19 respondents find their staffs that they respond late, 5 respondents find
their staffs give an indifferent approach and 1 respondent opted for others. The
majority of the respondents feels are their staffs respond late.

52
 CLASSIFICATION OF CUSTOMERS WHO
WOULD SUGGEST OTHERS TO START AN
ACCOUNT
Particulars No.of respondents
yes 80
no 20
total 100

No.of respondents

80
70
60
50
40
30
20
10
0
yes no

Interpretation
The Table and Figure shows that out of 100 Respondents, 80% of the
respondents would suggest others to start an account and 20% of the respondents
would not encourage others to start an account. The majority of the account
holders are interested to suggest others to start an account with India Post.

53
CLASSIFICATION ON THE BASIS OF
SATISFACTION OF INTEREST RATE
PROVIDED
Particulars No.of
Respondents
Yes 60
No 40
Total 100

NO 40

YES 60

0 20 40 60 80

Interpretation

The Table Figure shows that out of 100 respondents, 60% respondents are
satisfied with the interested rates provided by IPPB and 40% respondents are
unsatisfied with the interest rate provided by IPPB. The majority of the people
are satisfied with the interest rate provided.

54
 CUSTOMER S AWARENESS ABOUT
INVESTMENT SCHEMES PROVIDED BY
INDIA POST PAYMENT BANK
Particular No.of
Respondents
yes 40
no 60
Total 100

40%
yes
60%
no

Interpretation

The Table shows that out of 100 respondents, 40% of the respondents are aware
about the investment schemes provided by IPPB and 60% are not aware about
the investment schemes. The majority of the respondents are not aware about the
investment schemes provided by IPPB.

55
DURATIONOF HOLDING AN ACCOUNT WITH
IPPB
Particulars No.ofRespondents
less then 1 year 10
1 year - 3 years 30
3 years - 5 years 33
Above 5 years 27
total 100

35

30

25

20

15

10

0
less then 1 year 1 year - 3 years 3 years - 5 years Above 5 years

Interpretation
The Table shows that out of 100respondents, 10% belongs to category Less than
1 Year, 30% belongs to category 1 Year - 3 Years, 33.3% belongs to category 3
Years - 5 Years and 27% belongs to category More than 5 Years. Majority of the
respondents belong to category 3 Years - 5 Years.

56
 What are your thoughts about ippb mobile app?
Particulars no.of
Respondent
very good 40
good 10
average 40
poor 10
total 100

no.of Respondent

10%
very good
40% good
average
40%
poor
10%

Interpretation:
The Table shows that out of 100 Respondents, 40 respondents find the Very good
use in app, 40 respondents find their app is good in average, 10 respondents find
their app and 10respondent opted for poor. The majority of the respondents feels
are their good and good in average.

57
 What arethe features you familiar with in ippb app?
Particulars No.of
Respondent
money transfer 60
Direct Benefits Transfers 20
Third party Products 5
Bills and utility 15
total 100

No.of Respondent

15%

5% money transfer
Direct Benefits Transfers
Third party Products
20% 60%
Bills and utility

Interpretation
The table show that out of 100 Respondents, money transfer use 60% of
respondent, DBT is uses by 20, bills and utility use 15% of respondent and very
less is third party product use

58
 SERVICESPREFERRED BY CUSTOMERS
FROM INDIA POST PAYMENT BANK
Particulars No.ofRespondents
Postal Related 37
Financial Related 36
both 27
total 100

37 36
27

POSTAL RELATED FINANCIAL BOTH

RELATED

Interpretation
The Table shows that out of 100 respondents, 37% are satisfied with Postal
Services, 36.% are satisfied with Financial Services and 267% are satisfied with
both Financial and Postal Services. The majority of the respondents use both
Postal and Financial services provided by IPPB.

59
 Would you like to do banking with IPPB bank in

particular No.of Respondent

yes 70
no 30
total 100

near future

yes no

Interpretation
From the response collected from 100 respondent it can be observed that 70%
peopleare like IPPB bank in near future and there are still 20% of the people
don't like TO take financial product of IPPB bank.

60
61
CHAPTER 7

62
 Fact and Findings
 On the basis of gender, 56% were composed of male, 43% female and 1%
others. It can be inferred that majority of the respondents are male,
compared to 43 females and 1others, in a total of 100.
 On the basis of age, out of 100 respondents, 37% of respondents fall under
the age of 0-25, 42% of the respondents fall under the age group below 25,
14% of the respondents fall under the age group of 50-60 and 7% of the
respondents fall under the age group above 60. The majority respondents
are of the age between 25 and 50.
 On the basis of occupational status out of 100 respondents, 8% of
respondents are agriculturist, 23% of the respondents are in the business
and professional field, 21% of the respondents are salaries class and 48% of
the respondents are students and others. The majority respondents are
students and others (home maker, etc.).
 On the basis of IPPB account holders, out of 100 respondents,
30 % of the respondents are India Post Payments Bank Accountholders and
70% of the respondents are Non-Account Holders. It can be inferred that
the majority are NonAccount Holders.
 On the basis of awareness about IPPB, out of 70 respondents, 30% of the
respondents are aware about India Post Payments Bank services and 70 %
of ’100 the respondents are not aware about the service. It can be inferred
that majority of the respondents are not aware about the service.
 On the basis of year of account holding, out of 30 respondents 10% belongs
to category Less than 1 Year, 30% belongs to category 1 Year – 3 Years,
33.3% belongs to category 3 Years – 5 Years and 26.7% belongs to category

63
 More than 5 Years. Majority of the respondents belong to category 3 Years
– 5 Years.
 On the basis of ippbuses , 40 respondents find the Very good use in app, 40
respondents find their app is good in average, 10 respondents find their app
and 10 respondent opted for poor. The majority of the respondents feels are
their good and good in average.
 On the basis of type of account holders, in which33.3% are users of
Savings Account category, 20% are users of Recurring Account category,
26.7% are ’ 55 users of Term Deposit Account category, 13.3% are users of
Public Provident Fund Account category, 6.7% are users of Kisan Vikas
Patra category and 3% are users of other accounts. The majority of the
respondents are holders of Savings Account.
 On the basis of satisfaction out of 100 respondents, 36% are satisfied with
Postal Services, 36% are satisfied with Financial Services and 27% are
satisfied with both Financial and Postal Services. The majority of the
respondents use both Postal and Financial services provided by IPPB.
 On the basis of satisfaction of interest rate, out of 100 respondents, 60%
respondents are satisfied with the interested rates provided by IPPB and
40% respondents are unsatisfied with the interest rate provided by IPPB.
The majority of the people are satisfied with the interest rate provided.
 On the basis of sources of awareness of financial services of IPPB, out of
100 responds, 33% of the respondents have been aware of IPPB through the
help ’ 56 of advertisements, 37 % of the respondents got awareness through
friends and families and 30% of the respondents got awareness from agents
of IPPB. Majority of the respondents got the awareness through friends and
families.

64
  On the basis of staff’s approach towards customers, out of 100
Respondents, 5 respondents find the staffs are friendly, 17 respondents find
their staffs that they respond late, 7 respondents find their staffs give an
indifferent approach and 1 respondent opted for others. The majority of the
respondents feels are their staffs respond late.
 On the basis of customers opinion, out of 100 Respondents, 80% of the
respondents would suggest others to start an account and 20% of the
respondents would not encourage others to start an account. The majority of
the account holders are interested to suggest others to start an account with
India Post.

65
CHAPTER 8

66
 Limitations of the study

Following are the limitations of the study

This research is based on the responses of customers of urban area only.

This research is done in the suburban areas of Thane district only and
hence may not be applicable in other parts of country.
The result of the study is based upon the information given by the
respondents.
The study is confined to customers of India post offices in Varanasi district,
Uttar Pradesh, India.
The statistical tools used to analyze the data have their own limitation.

67
 CHAPTER 9

68
 Suggestions
Even though it is difficult to establish as postal bank India Post has an
opportunity to encash their trust and confidence. Through postal financial
services India Post is already providing various financial services since last many
years succssfully. India Post retail banking services are one of the largest retail
banking service available to masses. The well thought dedicated efforts need to
be taken to channlalise the future marketing strategies for delivering the
financial services. The advertising campaigns need to be designed for creating
awareness about the Postal bank services. The necessary training need to be
imparted to the staff for rendering postal banking services as well as
understanding the needs and preferences of customers. Well trained staff can
help to attract maximum number of customers and incraesing the customer
base.

69
 Chapter 10

70
71
 CONCLUSION
From the above research it can be inferred that postal banking can be the best
alternative for financial inclusion but it is very much challenging for India Post to
change the mind set of customers and make them opt for postal banking
services. In the urban areas majority of the customers are getting all kinds of
banking services as and when required from various kinds of well established
banks like nationalised, private and cooperative sector banks. Many people with
low income groups have also opened their savings bank account in nationalised
banks under PM Janadhana Yojana. Even the technological upgradation is a
major challenge in fornt of India Post. The banking sector of India is well
euipped with all the modern banking equipments like pass book printing
machine, sending mobile alerts, internet banking etc. To arrange the funds and
trained human resources to deliver banking services is a major challenge today
in front of India Post. Due the non avalilability of infrastructure and necessary
facilities of banking services the customer may not prefer to switch to postal
banking. The most important key factor is to understand the psychology and
pulse of the customer.For this purpose designing proper marketing strategy is
vital for facing the acute competition from other players.

72
 Chapter 11

73
Appendices

1. Name

2. Gender
Female Male Other

3. Age
Upto 30 years 31 - 40 years 41 - 50 years 51 - 60 years

4. Marital status
Married unmarried

5. Occupation
Job Business Student Other

6. Which company's plan do you have or would you like to have?

INVESTOSURE PVT.LTD life insurance

LIC
Bajaj Allianz life insurance
ICICI Prudential
SBI life insurance
HDFC Standard
other

7. Do you think that these companies provide promised services as per the set schedule?
Strongly agree
Agree

74
 Neither agree or nor disagree

8. Do you have an account in India Post Payment Bank?

Yes No

9. Are you aware about all the investment schemes that are provided by India Post Payment
Bank?
Yes No

10. For how many years do you have an account in India Post Payment Bank?
Less than 1 year 1 year – 3 years 3 years – 5 years More than 5 years

11. What type of account do you have in India Post Payment Bank?
Savings Account Recurring Account Term Deposit Account
Public Provident Fund Account Kisan Vikas Patra Others

12. Which services are mostly preferred by you in India Post?

Postal Related Financial Related Both

13. Are you satisfied with the interest rate provided by India Post Payment Bank?
Yes No

14. What are the sources of awareness regarding financial services in India Post Payment
Bank?
Advertisement Agents Friends, relatives others

15. How does the Postal Department staffs respond to their customers?
Friendly Immediate Approach Indifferent Approach Any other

16. Would you suggest someone to start an account with India Post Payment Bank Account?

75
 Yes No

17. What are the features you familiar with in ippb app?
Money Transfer
Direct Benefits Transfers
Third party Products
Bills and utility

18. Would you like to do banking with IPPB Bank in near future?
Yes No

76
Chapter 12

77
 Webliography
1) www.indiapost.gov.in
2) www.ippbonline.com
3) www.rbi.org

 https://ijcrt.org/papers/IJCRT2004563.pdf

78
Chapter 13

79
 REFERENCE

o Dr.P.Saritha Srinivas and P.Mohan Reddy (2010), “Marketing of Banking Financial

Services”, Serial Publishers, New Delhi
o B B Misra and P.C.Misra(2008), “Bank Marketing” Discovery Publishing House,
New Delhi
o Deepali Pant Joshi (2011) “The Financial Inclusion Imperative and Sustainable
Approaches”, Foundation Books, Delhi
o K G Karmakar, G.D.Banerjee, and N.P.Mohapatra, “Towards Financial Inclusion in
India”, Sage Publishers, New Delhi
o L M Ganesan - Study on ICT based financial inclusion through BC- Impediments
and Corrective Actions Report of the Expert Committee on Harnessing the India
Post Network for Financial Inclusion
o Dipankar Malakar - Role of Indian Post in Financial Inclusion
o R Jain, T Morris and G Raghuram IIM Ahmedabad Indian Postal Department –
Generating Financial Resources8) Rangarajan Committee Report on Financial
Inclusion ,2008

80