Are bank workers in the PSU Bank becoming more productive?

As a result of increased operational efficiency and staff productivity, public sector banks' (PSBs') Business Per staff (BPE) has improved dramatically over time.

Based on data gathered by Business Standard from the most recent PSB annual reports, the BPE of State Bank of India (SBI) increased from Rs.34.10 crore in FY24 to Rs.37.37 crore in 2024-25 (FY25), that of Punjab National Bank (PNB) increased from Rs.23.84 crore to Rs.26.86 crore, and that of Bank of Baroda (BoB) increased from Rs.29.31 crore to Rs.32.53 crore.

A stronger basis for long-term growth and profitability is indicated by the rise in BPE, which shows that each employee is producing more business than previously due to cost reduction, digital adoption, and improved resource use.

This growth can be attributed to two factors. First, the banks have been using technology, digitalization, and training as interventions to improve procedures, including sales activities. Productivity is steadily increasing as a result. Second, as the economy and per capita income expand overall, so do the underlying transaction sizes, which improves results," stated Sanjay Agarwal, senior director at CARE Ratings Ltd.

The BPE of UCO Bank grew from Rs.20.93 crore in FY24 to Rs.24.35 crore in FY25. Likewise, Canara Bank's BPE increased from Rs.25.97 crore to Rs.29.30 crore in FY25.  A year-over-year (Y-o-Y) increase in its BPE from Rs.25.87 crore to Rs.28.21 crore was also reported by Bank of India (BoI).

 

Aggarwal issued a warning, though, saying that banks must make sure that the rush for more productivity doesn't result in employees expecting an intolerable amount of work or in a greater distance from consumers.

Over time, the majority of PSBs have seen a decrease in their workforce.From 52,374 in FY23 to 50,944 in FY24 and then to 50,564 in FY25, BoI showed a steady reduction. The number of employees at Canara Bank similarly declined, going from 84,978 in FY23 to 82,638 in FY24 and finally to 81,260 in FY25.

At 76,513 in FY23, the BoB headcount gradually decreased to 74,227 in FY24 and 73,742 in FY25. Conversely, SBI, the biggest lender, saw a little increase in overall staff numbers to 236,226 in FY25 following a drop from 235,858 in FY23 to 232,296 in FY24. According to their yearly reports, all PSBs now have more branches.In FY23, SBI had 22,405 branches; in FY24, it had 22,542 branches; and in FY25, it had 22,937 branches.

The Reserve Bank of India has warned that there is an increasing risk of over-automation or erosion of credit evaluation standards as a result of a higher reliance on system-driven processes, especially in areas like top-up loans and unsecured lending.

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DA decrease for Bank Employees from May 2025

The Dearness Allowance (DA) for bank employees for the period of May 2025 to July 2025 is expected to be 19.90% based on the average CPI-IW index of 142.93 for the current quarter. This is a slight decrease compared to the 21.20% paid in the previous quarter. The calculation is based on the 12th BPS, and the DA is expected to be 20.17% from May 2025. 

Here's a more detailed breakdown:

Expected DA: 19.90%
CPI-IW Index (Base 2016=100): 142.93
Average Index for Current Quarter: 142.93
Index above 123.03 points: 19.90
DA for Previous Quarter: 21.20% 

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DA increased for Bank Employees and Pensioners from Feb-2025, Complete Chart

On the basis of CPI data announced by the Govt for the months of Oct'24 to Dec'254 DA payable for the period Feb'25 to Apr'25 is 21.20% as per 12th BPS.

 

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Expected DA for Bankers from February 2025

 

Expected DA Calculation Updated on 06.01.25 on the basis of CPI for the month of Nov'24 with the assumptions of CPI for the next month (Dec'24) as mentioned hereunder, as per the DA calculation norms of 12th BPS on revised basic pay. The CPI for the month of Nov'24 which was due to be released on 06.01.25 announced on 06.01.25 as 144.50 without any change in CPI from Oct'24. 

On assumptions if there is an increase of CPI index by 0.90 points in the month of Dec'24, keeping in view of on going regular rise in prices of commonly required daily needs / items and commodities which is making month over month difficult to manage family budget. Accordingly, on this assumption, we may expect there would be an increase of 1.94% DA in terms of 12th BPS on revised pay. Total 21.77% DA will become payable from Feb'25.

On assumptions if there is an increase of CPI index by 0.70 points each in the next months, we may expect there would be an increase of 1.87% in terms of 12th BPS on revised pay. Total 21.70 percentage of DA will become payable from Feb'25.

On assumptions if there is an increase of CPI index by 0.60 points in the month of Dec'24, we may expect would be an increase of 1.84% in terms of 12th BPS on revised pay. Total 21.67 percentage of DA will become payable from Feb'25.

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DA increase for Bankers from November 2024

 

Today i.e. on 04.11.24 Govt declared CPI for the month of Sep'24 as 143.30 with an increase of 0.70 points from the previous month i.e. Aug'24. . Bankers DA calculator is updated hereunder on the basis of CPI for the month of Jul'24 to sep'24. Earlier the Govt vide their notification dated 22.10.20 (click to view the letter) has changed the Consumer Price base year from 2001=100 to 2016=100 for Industrial Workers.

On the basis of CPI data announced by the Govt for the months of Jul'24 to Sep'24 DA payable for the period Nov'24 to Jan'25 is 19.84% as per 12th BPS.

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Expected DA for Bankers from Nov-2024

 

Expected DA calculation updated today on 01.10.24 on the basis of CPI announced by the GOI for the month of Aug.'24 and with the assumptions of CPI for the month of Sep.'24 as mentioned hereunder.

The CPI for the month of August, 2024 announced today as 142.60 points decreased by 0.10 points only from 142.70 points in July, 2024.

1. On assumptions if there is a decrease of 0.50 points of CPI  in the month of Sep.'24, on this assumption, we may expect that there would be an increase of 2.24% DA only and the total tentatively revised DA would be 19.44% from Nov.'24 in terms of 12th BPS.

2. On assumptions if there is no increase/decrease of any points of CPI in the month of Sep.'24, on this assumption, we may expect that there would be an increase of 2.40% DA only and the total tentatively revised DA would be 19.60% from Nov.'24 in terms of 12th BPS.

3. On assumptions if there is an increase of 0.50 points of CPI in the month of Sep.'24, on this assumption, we may expect that there would be an increase of 2.57% DA only and the total tentatively revised DA would be 19.77% from Nov.'24 in terms of 12th BPS.

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DA increase for Bankers from Aug 2024

 

Good news for bank employees! The Dearness Allowance (DA) has been increased for the period from August to October 2024. This adjustment aims to help employees cope with rising living costs. Keep reading to find out the new DA rates and how this change will affect your salary.

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Good news for Bank Employees about PSU bank Privatisation

In a significant policy shift, the Centre has postponed the privatisation of two public sector banks (PSBs), according to sources. This decision comes amidst indications that the government is reassessing its approach to merging PSBs in the fiscal year 2025 (FY25). The disinvestment pipeline, as per sources, will be influenced by the prevailing market conditions.

Earlier on Wednesday, Finance Secretary TV Somanathan stated that the government will avoid pre-announcing its divestment plans for FY25 to ensure the optimal valuation of public companies. The Union Budget, for the second consecutive year, omitted any mention of ‘disinvestment’, highlighting the Modi 3.0 Government’s focus on enhancing the value of Central Public Sector Enterprises (CPSEs) rather than reducing its equity holdings.

Finance Minister Nirmala Sitharaman has set a disinvestment target of Rs 50,000 crore for 2024-25. However, the Interim Budget presented in February revised the disinvestment estimate for 2023-24 down to Rs 30,000 crore. The Interim Budget for FY2025 included a general category named ‘Miscellaneous Capital Receipts’ under capital receipts, which did not specifically mention ‘disinvestment’. This category comprises receipts from managing equity investments and public assets through various mechanisms.

The government aims to generate Rs 50,000 crore from disinvestment and asset monetization in the current fiscal year, according to DIPAM Secretary Tuhin Kanta Pandey. At a press conference following the Union Budget presentation, Pandey emphasized, “Our focus is on value creation.” This Rs 50,000 crore target under ‘Miscellaneous Capital Receipts’ encompasses various types of receipts, including disinvestment and asset monetization.

In a pre-Budget report, SBI Research suggested that the government should establish a clear policy on PSB disinvestment. The report stressed the importance of a concrete roadmap to attract capital and boost confidence in financial institutions. Additionally, a recent report from CareEdge Ratings highlighted a substantial disinvestment capacity of approximately Rs 11.5 trillion, based on current market capitalizations. This figure assumes the government maintains a minimum 51 percent stake in the public enterprises.

The decision to stay the privatisation of PSBs reflects the government’s strategic shift towards maximizing the value of its public sector enterprises rather than immediate divestment. With a significant disinvestment target and a focus on market conditions, the Centre’s approach aims to balance fiscal goals with market stability and investor confidence.

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