To,
All HoCs
Subject: Revised commission/incentive structure for “Distribution of Commission/incentive pay out to DoP for handling the work of IPPB”.
Madam/Sir,
I am directed to refer to the subject mentioned above and to state that the last revision in the commission/incentive structure for “Distribution of Commission/incentive pay out to DoP for handling the work of IPPB” was conveyed vide this Directorate’s O.M. of even number dated 14.01.2022 (copy enclosed).
Considering the experience gained based on the working of the current Incentive/Commission structure, and the recommendation of the first Incentive Committee regarding regular review of the incentive/schemes performance, the arrangement was looked into afresh. Accordingly, the incentive Committee so constituted, reviewed the Incentive structure, with the aim of making the structure more efficient and beneficial for the End Users, DoP and IPPB.
As approved by the Competent Authority, the revised commission/incentive structure for “Distribution of Commission/incentive pay out to Department of Posts for handling the work of IPPB”, based on the recommendations of the Incentive Committee is placed at Annexure I for kind information. It may kindly be circulated upto the last mile and brought to the notice of all concerned (End Users) involved in providing IPPB services.
Yours faithfully,
Encl.: As Above
Digitally signed by
Dharmmajyati Ramdas Gajbhiye
(Pharma Vgl. G. D. A.V.)
Director (PBI)
Copy for information & necessary action to :-
- All Members – Postal Service Board/Addl. DG
- AS & FA
- CGM (BD)/CGM (PLI)/CGM (Parcel)
- All Sr. DDGs/DDGs
- Director RAKNPA Ghaziabad
- All GMs (Finance)/DAPs
- All Directors Postal Training Centres
- Sr. PPS to Secretary Posts/PS to DG (Posts)
- PPS to Secretary (PSB)
- MD & CEO, IPPB
Annexure-I
Revised Commission/Incentive structure for “Distribution of Commission/Incentive pay out to DoP for handling the work of IPPB”.
(1) Share of Incentive/Commission from IPPB to DoP for Income Generating Transactions is henceforth increased from 40 % to 50 %. The revised revenue sharing between Department of Posts and IPPB will be in the ratio of 50:50. Further, the 50 % of commission to the Department will be redistributed between Department & End Users as follows:
| Total Received by the Department | Department’s share | Share of L0 | Share of L1 | Share of L2 |
|---|---|---|---|---|
| 50% | 25% | 20% | 2.5% | 2.5% |
(2) The clause 8 (d) of the Commission/Incentive structure conveyed vide Directorate’s O.M. No. 1-3/2017-PBI dated 14.01.2022 (copy enclosed) related to incentive/commission structure of IPPB with other BCs (Individual/Corporate) to be at par or lower than that of DoP shall remain unchanged.
(3) Categorization of products/services on the basis of efforts made by the End Users as per the earlier Incentive Structure is henceforth discontinued.
(4) The revised commission/incentive structure will be as follows:
| Activity | Classification | Total Payout from IPPB to DoP (As % Revenue per Transaction) | DoP End User Incentive | DoP Commission | ||
|---|---|---|---|---|---|---|
| L0 | L1 | L2 | ||||
| Transactional Revenue | Products/Services | 50% | 20% | 2.5% | 2.5% | 25% |
| Acquisition # (Savings Account) | Pre Priced Saving Account with Aadhaar Seeding | 50% | 20% | 2.5% | 2.5% | 25% |
| Acquisition # (Current Account) | Pre Price Account with VDC issuance & Aadhaar seeding | 50% | 20% | 2.5% | 2.5% | 25% |
| Acquisition # (Current Account) | Pre Priced Account & Installation of UPI QR Card and two inward UPI Credits in 30 days in INR | 50% | 20% | 2.5% | 2.5% | 25% |
| Incremental Savings Account | On incremental balances to DoP circle on target | 0.20% | 0.00% | 0.00% | 0.00% | 0.20% |
| Balance achievement (Annualized on average monthly balances) | 0.50% | 0.00% | 0.00% | 0.00% | 0.50% |
*End Users and L1/L2 Incentives shall only be paid out in a month if Incentive amount is >=Rs160*
# Acquisition incentive shall be payable only subject to full recovery of the Upfront Annual Account Maintenance Charges at the bank’s end. No Incentive shall be payable on opening of Saving account which does not meet above criterion.
(5) The proposal of IPPB for introduction of incentive/commission to DoP and its End Users for Aadhaar seeding in IPPB accounts & IPPB-POSA linkage has been accepted and the incentive/commission structure for the same shall be as follows:-
| No. of IPPB accounts seeded with Aadhaar (reset of criteria on calendar month basis) | Incentive/commission per seeding (For DoP & its End Users) | No. of POSA accounts linked to IPPB accounts (reset of criteria on calendar month basis) | Incentive/commission per linkage (For DoP & its End Users) |
|---|---|---|---|
| 1-9 | DoP – Rs. 5 Per account End Users- Rs. 5 for all accounts | 1-9 | DoP – Rs. 5 Per account End Users- Rs. 5 for all accounts |
| 10 & above | DoP – Rs. 10 Per account End Users- Rs. 10 for all accounts | 10 & above | DoP – Rs. 10 Per account End Users- Rs. 10 for all accounts |
(6) The proposal of IPPB for introduction of incentive/commission on onboarding of PM Vishwakarma beneficiaries as IPPB Merchants has been accepted and the incentive/commission structure for the same shall be as follows:-
| Merchant Onboarding & UPI QR Issuance | 2 Inward Transactions on same date of onboarding | Monthly Onboarding count | Incentive to L0 End Users & IBCs per eligible Merchant |
|---|---|---|---|
| Yes | Yes | 1 – 5 | A total 50 % of the Per-Transaction revenue shall be given to DoP. Out of which, 25 % shall be kept with DoP as its share and 25 % shall be distributed among End Users (L0-20 %, L1-2.5 % and L2-2.5%) |
| Yes | Yes | 6 & Above | Incentive:- (starting from 1st account) |
(7) The proposal of IPPB for introduction of incentive/commission on acquisition of New Acquisition Variants, Loan Referral and International Money Transfer (IMT) has been accepted and the incentive/commission structure for the same shall be as follows:-
| S. No. | Activity | Additional Incentive/Commission for EU & DoP (Fig in %) | Total Payout from IPPB to DOP (As % Revenue per transaction) | DOP End User Incentive | DOP Commission | ||
|---|---|---|---|---|---|---|---|
| Classification | L0 | L1 | L2 | ||||
| 1 | Tentative New Incentive/Commission | New Acquisition Variants* Premium Sampoorna with Aadhaar Seeding & VDC Premium Sampoorna with Aadhaar Seeding Premium Rakshak with Aadhaar Seeding Premium Vyapaari with Aadhaar Seeding Premium Sampoorna without Aadhaar Seeding Premium Rakshak without Aadhaar Seeding Premium Vyapaari without Aadhaar Seeding | 50.00% | 20% | 2.5% | 2.5% | 25% |
| 2 | Additional Incentive/Commission | Loan Referral* Loan Referral: 0.8% is Bank’s Tentative Commission (Tentative Average Ticket Size: Rs.1,00,000) | 50% | 20% | 2.5% | 2.5% | 25% |
| 3 | Additional Incentive/Commission | International Money Transfer (IMT) * IMT: 1% is Bank’s tentative Commission (Tentative Average Ticket Size: Rs.30,000) | 50% | 20% | 2.5% | 2.5% | 25% |
Incentive calculation is tentative based upon transactional value & Partner product pricing
(8) Any future proposal for introduction of incentive/commission on new product/service or change in the existing proposal shall be placed before a separate committee to be constituted by PBI Division at Directorate level. The committee will examine all such proposals and give its recommendations on case to case basis. No suo moto decision shall be taken by IPPB in this regard.
(9) Recovery of financial disincentive imposed on IPPB
(i) As per the conditions laid down in the existing MoU signed between DoP and IPPB, the procedure for recovery of financial disincentive imposed on IPPB shall be as follows :-
The Department shall ensure that :-
(a) Whether detailed SoPs based on the regulatory guidelines, rules and processes have been provided by IPPB to the End Users or not.
(b) Whether IPPB has imparted required training to End Users or not.
(c) DoP shall initiate an enquiry into the matter and ensure whether the said penalty has arisen solely due to act or omission of DoP staff or agent inspite of clear rules and procedures communicated by IPPB or whether there are lapses on the part of IPPB.
(d) If after the enquiry it is found that the said penalty has arisen solely due to act or omission of DoP staff or agent inspite of clear rules and procedures communicated by IPPB , then the recovery must be done as per the following procedure :-
The total amount of financial disincentive imposed on IPPB from any authority for the Financial Year 2023-24 and 2024-25 shall be divided into the ratio of 60:40 (60 percent for IPPB and 40 percent for DoP) and recovery of 40 % may be done from the incentive payable to the End Users and the remaining penalty may be paid by IPPB from its own share. The ratio of 60:40 will be changed to 50:50 from the financial year 2025-26 for the financial disincentive imposed on IPPB by any authority.
(e) If after the enquiry it is found that the said penalty has not arisen solely due to act or omission of DoP staff, however there are certain lapses on the part of IPPB then the entire recovery must be paid by IPPB from its own revenue.
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