Mumbai: In order to provide relief to the families of bank employees, the government has announced to increase its share in the New Pension System (NPS) contribution.
The government has approved the proposal of the Indian Banking Association to increase the family pension to 30% of the last drawn pay. With this move of the government, the family pension of bank employees will increase from Rs 30,000 to Rs 35,000. This was announced by the Secretary, Department of Financial Services, Ministry of Finance at a press conference addressed by Finance Minister Nirmala Sitharaman in Mumbai.
Contribution to NPS will increase by 40%
At present, the contribution of banks in the Pension Fund (NPS) of employees working in public sector banks is 10%. Now it has been increased from 40% to 14%, although the minimum contribution by the employee has been kept fixed at 10%. Its calculation is done on the basis of basic pay and dearness allowance. It is calculated by adding dearness allowance and basic pay. With this announcement, the rule of NPS for the employees of public sector banks has become like that of central employees.
Will get more money in retirement fund
Under the National Pension System (NPS), the contribution by the government for the central employees has been kept at 14 percent of the basic and dearness allowance and the minimum contribution of the employee has been kept at 10 percent. Now banking employees will also get the benefit of this. Due to the implementation of this rule, the retirement fund of banking employees will be more.
Apart from this, the Finance Ministry has also changed the rules regarding family pension after the death of banking employees. If a bank employee dies, then his family will get 30 percent of the last salary as pension. Earlier the family pension in such cases was Rs 9284.
Expressed satisfaction over the performance of banks
Earlier, Finance Minister Nirmala Sitharaman expressed satisfaction over the performance of public sector banks in the last few years. He appreciated that many banks have come out of the Reserve Bank of India’s immediate corrective action framework. On this matter, Financial Services Secretary Debashish Panda said that many public sector banks have now become profitable. This has increased the confidence of investors in them and they have become self-reliant in the matter of raising capital. The banks collectively raised Rs 69,000 crore since last year. This includes equity capital of Rs 10,000 crore. They are in the process of raising another Rs 12,000 crore.
Minimum stake in companies
Regarding the plan to reduce stake in insurance companies, Sitharaman said that the government will keep minimum stake in such companies. He also said that there is no need for the employees to panic, the government is sensitive about their concerns. When asked whether the government is considering to introduce insurance bonds as an alternative to bank guarantees, the Finance Minister said that this is only a suggestion, which has come from the industry side.
On the progress in the case of National Asset Reconstruction Company, Panda said that it has been registered and the Indian Banks’ Association (IBA) has gone to the RBI for the license. Hope to get license soon.
