New Delhi | India Post Payments Bank (IPPB) opened accounts without verifying mobile numbers and linked information of multiple customers to the same mobile number, the CAG said in a report tabled in Parliament on Thursday.

The Comptroller and Auditor General of India, in the audit, found that there was widespread dormancy and inactivity in IPPB's existing customer accounts.

"Additionally, accounts were opened without verified mobile numbers and multiple Customer Information Files were linked to the same mobile number. IPPB's Doorstep Banking services were found with limited uptake, with many requests delayed, cancelled, or unattended," the report said.

According to the report, IPPB has made strides in expanding its network and acquiring customers, but significant operational, regulatory and systemic issues have hindered its effectiveness in promoting financial inclusion.

The CAG audit found there was a high volume of declined transactions for IPPB's Unified Payments Interface (UPI) services, which undermined customers' trust.

"The data from National Payment Corporation of India revealed that IPPB's technical decline rate for UPI transactions was significantly high at 3.29 per cent in FY 2021–22 and 7.82 per cent in FY 2022-23, far exceeding RBI's target of less than one per cent," the report said.

The audit found that IPPB's UPI services in FY 2023–24 experienced outages equivalent to 362 hours, significantly higher than Fino (19 hours), Airtel (52 hours) and Paytm Payments Bank (zero hours).

CAG has recommended IPPB to implement robust monitoring and effective response to meet the prescribed benchmarks related to the UPI transactions consistently to protect the customer trust.

Among various suggestions, the auditor has asked IPPB to complete comprehensive data cleansing to eliminate invalid or duplicate linkages and identify the gaps in validation during account opening to strengthen its IT system.