The Reserve Bank of India (RBI) has introduced a new rule for banks that handle pension payments for retired central and state government employees.
If a bank delays paying the pension, it must now pay interest at 8% per year for the delayed period.
This rule aims to compensate pensioners for any inconvenience caused by late payments.
According to the RBI’s master circular, banks must pay this interest automatically—pensioners do not need to request it.
The interest will be credited to the pensioner’s account on the same day the delayed payment or arrears are made.
This rule applies to all delayed payments starting from October 1, 2008.
Improved Service and Timely Payments
To avoid delays, the RBI has instructed banks to collect pension orders quickly from the concerned authorities and ensure timely payments.
Banks have also been told not to wait for instructions from the RBI before releasing pension amounts. If a delay occurs, it should be fixed in the following month’s payment.
Additionally, banks have been advised to provide better customer service, especially to elderly pensioners.
The RBI emphasized the need for staff to be kind and helpful to senior citizens, making the process smoother and more respectful.
This initiative is expected to make pension handling more efficient and improve the overall banking experience for retirees.
