Recently, the Central Government has approved a 2% increase in Dearness Allowance (DA) for its employees. However, bank employees have received only a 0.70% increase in DA. The government has increased the dearness allowance (DA) of bank employees from 25% to 25.70% for the quarter May to July 2026. On one hand, dearness allowance of other central government employees was increased by 2%, while for bank employees it was increased by only 0.70%. Why is it like this? Let us know.
Why is dearness allowance of bank employees less?
Actually, the dearness allowance of bank employees is revised every quarter. This process involves gradual changes in the CPI-IW (Consumer Price Index for Industrial Workers); As a result, the amount of increase each time is relatively small. In contrast, the central government’s DA is revised twice a year based on a 12-month average, with inflation data from multiple months combined together in a single revision.
explained in simple words
In simple words: DA of bank employees increases by a small amount every time, yet there are more frequent revisions throughout the year. In contrast, the DA of central government employees is revised only twice a year; As a result, the magnitude of the increase in each revision is larger than that observed for bank employees.
It is worth noting that after the 0.70% increase in DA, the monthly salary of bank employees across different pay scales will increase by ₹435 to ₹1,050. For employees whose basic pay ranges between ₹48,000 to ₹117,000, this revised DA will result in a salary increase of ₹435 to ₹1,050. Although this may not be a huge increase, it is still a welcome move for bank employees.