The Reserve Bank of India increased the maximum balance per customer at the end of the day from Rs. 1 lakh to Rs. 2 lakh at Payments Banks (PBs) in an announcement dated April 8, 2021. This means that customers of payments banks like India Post Payments Bank (IPPB) are now limited to a maximum amount of Rs 2 lakh in their regular savings account at the end of the day. In this scenario, IPPB permits the account to be linked to a Post Office Savings Account (POSA). Any balance in IPPB account holders' accounts that exceeds Rs. 2 lakh at the end of the day is automatically transferred to the seeded POSA account.
Why Should One Link An IPPB Account With A POSB Account?
This strategy is essential for customers who want to save more funds for their personal financial goals. Instead of cancelling the transaction if the day-end balance surpasses the threshold, IPPB will transfer the excess funds to POSA customers. Furthermore, there is no highest limit that can be transferred, implying that you can transfer your entire balance from IPPB to POSA at once. POSA holders can use their IPPB savings account to withdraw or deposit funds according to their needs, and this service will improve their liquidity.
To use this excess fund transfer option, customers with an India Post Payments Bank (IPPB) account must first open a Post Office Savings Account (POSA). And opening a POSA account is simple and quick; POSA accounts can be opened with a minimum initial deposit of Rs. 500 with no upper limit. A customer who opens a POSA account will receive a 4% annual interest rate and also will be able to transfer his or her account from one post office to another with no lock-in or maturity conditions.
Benefits of Sweep-in and Sweep-out facility
IPPB customers can use the Sweep-in and Sweep-out option to manage their short-term needs in a satisfactory way and any amount exceeding Rs. 2 lakh will be swept out into the associated POSA account. Sweep allows hassle-free transfers of funds from savings account to a POSA account both automatically and manually, allowing the account holder to earn more interest and reducing the instance where IPPB savings accounts surpass their upper deposit limit and remain inactive while earning interest income.
Having a Sweep-in and Sweep-out facility provides IPPB account customers with unique benefits such as no minimum cash withdrawal limit, zero additional charges for opting Sweep-in or Sweep-out facility, this service can be accessed via facilitated touch-points such as Doorstep Service, Access Point and via IPPB Mobile App.
IPPB savings account holders can also check their account balance through a few taps using the IPPB App. Customers should keep in mind that on all working days, Sweep services are accessible from 8:00 a.m. to 8:00 p.m. or until funds in the Sweep account are available. On the 2nd and 4th Saturdays, Sundays, and RTGS holidays, sweep-in services will be unavailable.
Steps to link IPPB with POSA
Customers must have an active individual POSA account to link their IPPB savings account; if they do not have one, they can establish one at their local post office. Via Doorstep service or at the IPPB Access Point, a POSA account can be linked at the time of creating an IPPB account or after that.
While linking a POSA account, the customer must provide his or her POSA passbook to the GDS/Postman during Doorstep service or to the registered employee at the Access Point. IPPB account holders will get a successful message via SMS on their registered mobile number following the effective linking of the POSA account.
IPPB account holders should be aware that linking POSA is not possible with a Digital savings account. Nevertheless, after switching Digital savings account to a savings account, an individual can link it to a POSA account to enjoy the enhanced daily balance limit which will allow them to save more for their financial goals.