The Comptroller and Auditor General of India has highlighted significant operational issues at India Post Payments Bank (IPPB) in a report tabled in Parliament on Thursday. According to the CAG audit, accounts were opened without verified mobile numbers and multiple Customer Information Files were linked to the same mobile number. The report also found widespread dormancy and inactivity in IPPB's existing customer accounts, with the bank's Doorstep Banking services experiencing limited uptake and many requests being delayed, cancelled, or unattended.
The CAG audit revealed serious technical challenges with IPPB's UPI services, with technical decline rates significantly exceeding regulatory targets. As reported by the CAG, IPPB's technical decline rate for UPI transactions was 3.29% in FY 2021-22 and 7.82% in FY 2022-23, far surpassing the RBI's target of less than one percent. The audit found that IPPB's UPI services in FY 2023-24 experienced outages equivalent to 362 hours, significantly higher than competitors like Fino (19 hours), Airtel (52 hours), and Paytm Payments Bank (zero hours).
The CAG has made specific recommendations to address IPPB's operational challenges. According to the report, the auditor has recommended IPPB to implement robust monitoring and effective response to meet prescribed benchmarks related to UPI transactions consistently to protect customer trust. Among various suggestions, the CAG has asked IPPB to complete comprehensive data cleansing to eliminate invalid or duplicate linkages and identify gaps in validation during account opening to strengthen its IT system. The audit found that despite IPPB's efforts to expand its network and acquire customers, significant operational, regulatory and systemic issues have hindered its effectiveness in promoting financial inclusion.
