Committee on Procedures & Performance Audit on Public Services (CPPAPS) – Report No. 2 – Compensation structure for delay in payment of interest and/or principal

As the interest rates on  SB accounts have been freed by Reserve Bank of India, this has had an impact on  Relief/Savings Bonds.

As per RBI  our circular CO. DT. No. 13.01.298/H-9786/2004-05 dated May 20, 2005 (RBI/2005/477), on the captioned subject,  para 3 thereat, states that an investor in Relief/Savings Bonds has to be compensated by the concerned bank at ‘current Saving Bank Rate’ on account of financial loss incurred by the investor due to late receipt/delayed credit of interest warrants/ maturity value of investment, etc.

In this regard, RBI has  advised that as the interest rate on savings deposits have since been deregulated, the respective bank shall compensate the investors for the above mentioned financial loss at their own Saving Bank deposit rate for respective amounts (i.e. Rs1 lakh and over Rs1 lakh) without any discrimination.

This Notification is applicable to the following Banks : –

The Chairman and Managing Director/Managing Director –

Government Accounts Department/Head Office State Bank of India/State Bank of Patiala /State Bank of Bikaner & Jaipur /State Bank of Travancore/ State Bank of Hyderabad/State Bank of Mysore/ Andhra Bank/ Allahabad Bank/Bank of Baroda /Bank of India/ Bank of Maharashtra/ Canara Bank/ Central Bank of India/ Corporation Bank/ Dena Bank/ Indian Bank/ Indian Overseas Bank/ Punjab National Bank/ Syndicate Bank/ UCO Bank/ Union Bank of India/ United Bank of India/ Vijaya Bank/ IDBI Bank/ ICICI Bank Ltd. AXIS  Bank Ltd., HDFC Bank Ltd., and SCHIL

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