NEW DELHI : Amid reports that the public sector banks (PSBs) have enrolled customers for the small insurance schemes launched by Prime Minister Narendra Modi without their permission, bankers say they are not allowed to do so without their consent.
Though the bankers concurred that every banking branch has a monthly target to accomplish, they can’t deduct premium without customers’ authorisation. These small insurance schemes include - Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Atal Pension Yojana and they aim to provide social security to the people below certain income threshold after the age of 60.
“Every banking branch has a monthly target to achieve. They do try to sell such schemes when customers apply for loans but they never coerce them. Without consent no, banks can debit such amounts from the customers’ accounts. This particular case may be exceptional but generally they take consent,” a banking official, who didn’t wish to be identified told this paper.
Meanwhile, another former banker said that many times when a premium is very low, which people generally don’t care about, banks may undertake such steps. But customers can always exit such schemes. He reiterated what the above official claimed that without permission, such transactions are not possible.
Another top banking official claimed the Centre never creates pressure on banks to achieve the targets for their schemes.
Finance Minister Nirrmala Sitharman in her tweet on X while responding to Jairam Ramesh’s claims that the Atal Pension Scheme is a poorly-structured scheme and that many accounts were opened under the scheme without seeking permission from the customers, said, “Atal Pension Yojana is designed based on best practice choice architecture to automatically continue the premium payment unless the subscriber opts out. This is a deliberate and beneficial feature which is in the best interest of the subscribers. Instead of requiring people to decide each year to continue, they have to make a decision to discontinue. This makes many of them take the right decision and save for their retirement.”
Ramesh said about 83% of subscribers fall under the Rs 1,000 pension bracket due to its low monthly contribution, often overlooked by recipients.
Small insurance schemes include PMJJBY, APY
These small insurance schemes include - Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Atal Pension Yojana and they aim to provide social security to the people below certain income threshold after the age of 60. very banking branch has a monthly target to achieve.