Mumbai
In a recent directive of the Reserve Bank of India (RBI), it is now mandatory for all banks responsible for retiring central and state government employees to pay 8% per year interest for any delay in pension payment. Increase in the Master Circular of RBI This requirement is aimed at compensating for late payment of their dues to pensioners. According to the circular, ‘For banks paying pension payments, pensioner should pay compensation at a fixed interest rate of 8 percent per year after the due date of payment to the delay in depositing pension/dues.’
What is details?
The instructions further clarified that this compensation will be provided automatically without the need for any claim from pensioners. Compensation for any delay after the fixed payment date should be provided at a fixed interest rate of 8% per year. Interest will be deposited in the account of the pensioner on the same day when the bank will process the revised pension or pension arrears, which will be applicable to all late payments from October 1, 2008.
What is in the circular?
The circular also emphasizes the need to ensure a streamlined procedure for pension dishabers by banks, so that copies of pension orders can be avoided immediately by receiving copies of pension orders from the concerned pension payment officers. Banks have been instructed to complete pension payment without waiting for instructions from RBI, thus ensuring that pensioners get their benefits in next month’s payment cycle. In addition, RBI has urged banks to provide better customer service, especially the elderly pensioners, so that easily conversations can be provided.
The circular states, “All agency banks who distribute pension are advised to provide pensioners, especially those pensioners who are old, considering and sympathetic customer service.” This step is expected to provide better service to pensioners, which will make the banking experience less cumbersome for them.