RBI withdraws circulars on recovering excess payments made to pensioners

Pensioners had complained that the 'recovery of excess /wrong pension payments' was being done in violation of guidelines and court orders

The Reserve Bank of India (RBI) on Thursday withdrew three circulars on recovery of excess payments made to pensioners, saying the documents didn’t follow guidelines and court orders. 

In a circular issued on March 17, 2016, the RBI had said as soon as the excess payment made to a pensioner comes to the notice of the paying branch, “the branch should adjust the same against the amount standing to the credit of the pensioner’s account to the extent possible including lumpsum (sic) arrears payment.” 

If the entire amount of over payment cannot be adjusted from the account, the pensioner would be asked to pay forthwith the balance amount of over payment. 

In case the pensioner expressed his inability to pay the amount, the same was to be adjusted from future pension payments For recovering the over-payment made to pensioner from his future pension payment in instalments one-third of net (pension + relief) payable each month was to be recovered unless the pensioner concerned gave consent in writing to pay a higher installment amount. 

If the over payment could not be recovered from the pensioner due to his death or discontinuance of pension then action was to be taken as per the letter of undertaking given by the pensioner under the scheme. 

However, in its latest circular on Thursday, the central bank said pensioners complained that the “recovery of excess /wrong pension payments from the pensioners are being made in a manner that is not in keeping with the extant guidelines / Court orders.” 

The RBI advised banks to seek guidance from pension-sanctioning authorities regarding the process to be followed for recovery of excess pension paid to the pensioners, if any.