Pension payment: Dearness Relief to Life Certificate submission - 8 things retirees should note

The disbursement of pension to retired government employees is regulated by the relevant schemes established by both the central and state governments. Pension payments are facilitated through authorized banks, who are required to adhere to guidelines outlined in the Reserve Bank of India's "Master Circular - Disbursement of Government Pension by Agency Banks".

Recently, the RBI has made updates to the Master Circular and has addressed eight specific issues related to pension payments to Central Government pensioners through a series of questions and answers. This article will delve into these issues in depth.

> Revision of Dearness Relief Rate

In the event of the Government increasing the dearness relief rate, banks are instructed to promptly adjust and authorize their pension disbursing branches to make payments to pensioners accordingly.

According to the RBI, banks are required to determine the updated DR payment by either receiving government orders via mail, fax, or email, or by retrieving information from the official websites of the relevant government authorities.

> Life Certificate Submission Options

Pensioners have the option to submit their life certificates through the Jeevan Praman platform, eliminating the need to visit a branch.

This option is available only if the Pension Sanctioning Authority is also registered on the platform.
Special Consideration for Certain Individuals

The Reserve Bank of India has instructed banks to offer the convenience of submitting life certificates at the premises or residences of super senior citizens (those over 70 years old) and individuals with chronic illnesses or disabilities, including visual impairments.

> The RBI has advised that in the event of a pensioner's death, the family pension should be deposited into the existing account rather than requiring the family pensioner to open a new account specifically for this purpose. Additionally, banks are instructed not to require Central Government pensioners to open a new account if the spouse named in the Pension Payment Order (PPO) as the recipient of the family pension is still alive.

> When is pension credited?
Banks have to credit the pension per the instructions given by the Pension Paying Authorities.

> Excess pension payment
If an excess pension payment is mistakenly credited to a pension account, banks are advised by the RBI to consult the relevant Pension Sanctioning Authorities for instructions on recovering the overpaid amount. Additionally, if the excess payment is a result of a bank error, the additional funds should promptly be returned to the Government, bypassing any delay in recovering the overpayment from the pensioners.

> Acknowledgement slips

The RBI has mandated that banks must provide pensioners with signed acknowledgements upon receiving their life certificates. Additionally, banks may offer a digital acknowledgement for those who provide digital life certificates.

> Delayed pension

According to the RBI, banks responsible for pension payouts must provide pensioners with compensation for any delays in pension or arrears payments, calculated at a rate of 8% per annum after the scheduled payment date. This compensation should be automatically deposited into the pensioners' accounts without requiring them to file any claims.

> Pension payment to sick/disabled pensioners
The Reserve Bank of India (RBI) has issued specific guidelines to banks regarding the disbursement of pensions to ailing and incapacitated pensioners who are unable to physically visit the bank branches or provide their signature or mark on the necessary documents. In such situations, the bank has the authority to designate one of its officials, preferably from the same branch, to affix a mark on the cheque or withdrawal forms in the presence of two witnesses, with one of them being a reliable bank staff member.