7th CPC Resolution for Pensioners and Family Pensioners

7th CPC Resolution for Pensioners and Family Pensioners

(TO BE PUBLISHED IN THE GAZETTE OF INDIA (EXTRAORDINARY), PART I, SECTION 1)

GOVERNMENT OF INDIA
MINISTRY OF PERSONNEL, PUBLIC GRIEVANCES AND PENSIONS
(Department of Pension and Pensioners’ Welfare)

RESOLUTION

New Delhi, the 4th August, 2016

No.38/37/2016-P&PW (A) – The Terms of Reference of the Seventh Central Pay Commission as contained in Ministry of Finance (Department of Expenditure) Resolution No.1/1/2013-E.1I1 (A) dated 28.2.2014 included the following:

“To examine the principles which should govern the structure of pension and other retirement benefits, including revision of pension in the case of employees who have retired prior to the date of effect of these recommendations, keeping in view that retirement benefits of all Central Government employees appointed on and after 01.01.2004 are covered by the New Pension Scheme (NPS).”

2. The Commission, on 19th November, 2015, submitted its report to the Government on Terms of Reference as contained in aforementioned Resolution dated 28.02.2014. Government, after consideration, has decided to accept the recommendations of the Commission on pensionary benefits to the Central Government civil employees, including employees of the Union Territories and Members of All India Services subject to certain modifications, as specified hereinafter ..
   
3. Detailed recommendations of the Commission relating to pensionary benefits and the decisions taken thereon by the Government are listed in the statement annexed to this Resolution.
4. The revised provisions regarding pensionary benefits, which have been accepted as indicated in the Annexure, will be effective from 01.01.2016.

sd/-
(Vandana Sharma)
Joint Secrtary to the Govt of India

ItemNo.	Recommendation	Decision  of Government
1.	The Commission notes  that this  allowance   was enhanced  from Rs.300/-  p.m. to Rs.500/- p.m. from 19.11.2014.    As such, further enhancement of this allowance  is not recommended.(Para 8.17.52  of the Report)	To be     examined      by a Committee               comprising Finance        Secretary        and Secretary     (Expenditure)     as Chairman   and Secretaries   of Home       Affairs,        Defence, Posts,      Health      &     Family Welfare,  Personnel & Training and Chairman, Railway Board as Members.     Till    a final decision   is  taken based   on the   recommendations    of the Committee,      Fixed     Medical Allowance    shall be   paid   at existing  rates.
2.	Constant   Attendance   Allowance.The allowance  may be increased  by a factor of 1.5 i.e. to Rs. 6750/-  per month. The allowance  needs further   increase   by 25%  each  time DA  rises  by 50% .  (Para 8.17.29  of the Report)	To be     examined      by a Committee               comprising Finance        Secretary        and Secretary     (Expenditure)     as Chairman   and Secretaries   of Home       Affairs,        Defence, Posts,         Health    & Family Welfare,  Personnel  & Training and Chairman,  Railway Board as    Members.     Till a    final decision   is taken   based   on the recommendations    of  the Committee,                  Constant Attendant   Allowance shall  be paid at existing  rates.
3.	General  Provident FundStatus quo may be maintained  in this respect. (Para 9.4.4 of the Report)	Accepted
4.	Rates of Pension  & Family PensionThe Commission does not recommend any further increase  in the rate of Pension  and Family Pension from the existing  levels. (Para 10.1.25 of the Report)	Accepted
5.	Quantum  of Minimum PensionThe recommendations     of   the Commission     in relation   to pay  of  a personnel   will     lead to  a significant    increase    in the   minimum    from the existing   Rs.7,000    per month   to   Rs.18,000 per month.    This,  based on  computation   of pension, will   raise   minimum pension   from   the existing Rs.3500   to   Rs.9,000.      The minimum    pension based on the recommendations   of the Commission will increase  by 2.57 times over the existing  level. (Para 10.1.27 of the Report)	Accepted
6.	Rate of Additional   Pension  and Family Pension   to the older  pensioners. The Commission   is  of the  view  that the  existing rates  of additional   pension   and additional   family pension  are appropriate. (Para 10.1.30 of the Report)	Accepted
7.	Time Period for enhanced  family  pension.The Commission   notes  that the  recommendation with  regard to period  of eligibility  of the enhanced family  pension  of 10 years  in case  of death  of a serving    employee     was made    based on   the recommendations   of Vlth CPC  Report.   No further change      is being      recommended       by the Commission. (Para 10.1.33 of the Report)	Accepted
8.	Gratuity  ceiling and its indexation.The Commission  recommends enhancement  in the ceiling  of gratuity  from  the existing  Rs.10  lakh to Rs.20   lakh  from 01.01.2016.      The   Commission further   recommends   the ceiling   on  gratuity may increase  by 25% whenever   DA  rises by 50%.	Accepted
9.	Rationalization   of death gratuityThe Commission,   after  examination   of the matter, recommends   the  following rates  for  payment of death gratuity: Length   of Service Rate       of       DeathGratuity Less than One year 2 times   of  monthly emoluments One Year   or   more but less than 5 years 6 times   of  monthly emoluments 5 years  or more but less 11 years 12 times  of monthly emoluments 11 years   or     more but   20  times 20 times  of monthly emoluments 20 years or more Half month of emoluments for every completed six monthly period  of qualifying service subject to  a maximum of 33 times of emoluments. Para 10.1.41  of the Report)	Accepted
10.	Commutation of Pensionand restoration of Accepted commuted PensionThe Commission  does not recommend  any change either  in the maximum  percentage of commutation or in the period of restoration. (Para 10.1.43 of the Report)	Accepted
11.	Revision  of Pension of pre  7m CPC retireesThe Commission recommend the following pension formulation   for  civil employees   including CAPF          personnel     who have     retired     before 0.1.0.1.20.16 (i) All  the Civilian  personnel   including CAPF  who retired   prior to   01.01.2016  (expected    date of implementation of       the        Seventh        CPC recommendations    ) shall first  be fixed  in the Pay Matrix  being   recommended    by this  Commission, on  the basis  of the  Pay Band  and  Grade Pay  at which    they retired,    at the    minimum    of the corresponding    level  in the  matrix.    This amount shall be raised,  to arrive  at the  notional pay of the retiree,  by  adding the  number  of increments  he / she had earned  in that level while in service,  at the rate of  three   percent.     Fifty percent  of  the total amount  so arrived  at shall be the revised pension. (ii) The  second calculation   to be carried  out is as follows.    The  pension, as  had  been fixed  at  the time of implementation  of the VI CPC recommendations,    shallnbe  multiplied   by 2.57  to arrive at an alternate  value for the revised pension. (iii) Pensioners    may   be given   the   option of choosing   whichever    formulation    is beneficial   to them. It is recognized  that the fixation  of pension  as per formulation   in (i) above  may take a little time since the   records of  each   pensioner will   have  to be checked   to  ascertain the  number   of increments earned    in   the retiring    level.       It is   therefore recommended   that in the first  instance  the revised pension  may be calculated  as at (ii) above and the same  may, be paid as an interim measure.   In the event  calculation   as per  (i) above  yields a higher amount       the       difference        may       be       paid subsequently.(Para    10. 1.67 and    Para 10.1.68 of the Report)	Both the options recommended by  the 7th Central Pay Commission as regards  pension revision   be accepted  subject to feasibility of the implementation. Revision  of pension using the second     option based on fitment    factor of 2.57 be implemented immediately.The first  option may be made feasible after examination by the Committee comprising Secretary (Pension)   as Chairman and Member (Staff). Railway Board, Member   (Staff), Department of Posts, Additional Secretary &  Financial Adviser, Ministry of Home Affairs and Controller General of Accounts as Members
12.	Ex-gratia  Lumpsum CompensationThe commission recommends a Common regime for payment of ex-gratia lump-sum compensation for  civil and  defence  forces personnel,  payable  to the next of Kin at the following  rates: Circumstances Existing Proposed Death  occurring due  to accidents  in    course of performance  of duties 10 lakh 25 lakh Death     in the course of performance the course of attributed  to acts  of violence by terrorists, anti social elements  etc. 10 lakh 25 lakh Death occurring in border skirmisheds and action against militants, terrorists,extremists,sea pirates 15 lakh 35 lakh Death occurring while on duty in the specified high altitude, unaccessible border posts, on account of natural disasters, extreme weather conditions 15 lakh 35 lakh Death occurring during enemy action in war or such war like engagements , which are specifically notified by Ministry of Defence and death occurring during evacuation of Indian Nationals from a war-torn Zone in foreign country. 20 lakh 45 lakh (para 10.2.77)	Accepted

Authority: http://www.pensionersportal.gov.in/

PENSION CALCULATION AS PER 7TH CPC NOTIFICATION WITH ILLUSTRATION

PENSION CALCULATION AS PER 7TH CPC NOTIFICATION WITH ILLUSTRATION

For existing pensioners, who have retired before 01.01.2016, the revised pension/family pension with effect from 01.01.2016 shall be determined by multiplying the pension/family pension, as had been fixed at the time of implementation of 6th Central Pay Commission (CPC) recommendations, by 2.57. The amount of revised pension/family pension so arrived at shall be rounded off to next higher rupee.

Illustration:

Case I : Pensioner ‘A’ retired at last pay drawn of Rs. 79,000 on 31st May, 2015 under the 6th CPC regime in the scale of Rs. 67000-79000:

		Amount in Rs.
1.	Basic Pension fixed in 6tH CPC	39500
2.	Revised Pension fixed under 7tnCPC (using a multiple of 2.57)	101515

Case II
Pensioner ‘B’ retired at last pay drawn of Rs. 4,000 on 31st January, 1989 under the 4th CPC regime in the pay scale of Rs. 3000-100-3500-125-4500:

		Amount in Rs.
1.	Basic Pension fixed in 4tn CPC	1,940
2.	Basic Pension as revised in 6th CPC	12,600
3.	Revised Pension fixed under T” CPC (using a multiple of 2.57)	32,382

Authority: Authority: http://www.pensionersportal.gov.in/

7th CPC Pension Calculation : Implementation of First Option after Committee Report

7th CPC Pension Calculation : Implementation of First Option after Committee Report

“Revision of pension using the second option based on fitment factor of 2.57 be implemented immediately. The first option may be made applicable if its implementation is found feasible after examination by the Committee”

Revision of Pension of pre 7tn CPC retirees : The Commission recommends the following pension formulation for civil employees including CAPF personnel who have retired before 01.01.2016

(i) All the Civilian personnel including CAPF who retired prior to 01.01.2016 (expected date of implementation of the Seventh CPC recommendations ) shall first be fixed in the Pay Matrix being recommended by this Commission, on the basis of the Pay Band and Grade Pay at which they retired, at the minimum of the corresponding level in the matrix. This amount shall be raised, to arrive at the notional pay of the retiree, by adding the number of increments he / she had earned in that level while in service, at the rate of three percent. Fifty percent of the total amount so arrived at shall be the revised pension.

(ii) The second calculation to be carried out is as follows. The pension, as had been fixed at the time of implementation of the VI CPC recommendations, shall be multiplied by 2.57 to arrive at an alternate value for the revised pension.

(iii) Pensioners may be given the option of choosing whichever formulation is beneficial to them. It is recognized that the fixation of pension as per formulation in (i) above may take a little time since the records of each pensioner will have to be checked to ascertain the number of increments earned in the retiring level. It is therefore recommended that in the first instance the revised pension may be calculated as at (ii) above and the same may, be paid as an interim measure. In the event calculation as per (i) above yields a higher amount the difference may be paid subsequently.(Para 10.1.67 and Para 10.1.68 of the Report)
Both the options recommended by the 7th Central Pay Commission as regards pension revision be accepted subject to feasibility of the implementation. Revision of pension using the second option based on fitment factor of 2.57 be implemented immediately. The first option may be made applicable if its implementation is found feasible after examination by the Committee comprising Secretary (Pension) as Chairman and Member (Staff). Railway Board, Member (Staff), Department of Posts, Additional Secretary & Financial Adviser, Ministry of Home Affairs and Controller General of Accounts as Members

Authority: http://www.pensionersportal.gov.in/

7th Pay Commission Option Form Ready Reckoner For All Grade pay

7th Pay Commission Option Form Ready Reckoner For All Grade pay

Confused with “Form of Option” help us you to choose the best option

FORM OF OPTION [See rule 6 (2)] –

There has been a new “Form of Option” which is been floated in Central Government Departments after Gazette Notification and employees are filling their details and handing over to the department.  There has been doubts and queries about which option would be more beneficial and this is leading towards confusion.

Option 1:

Employee agree to get their revised pay structure with effect from 1st January, 2016

Option 2:

• Employees can hereby elect to continue on Pay Band and Grade Pay of my substantive / officiating post mentioned below until: * the date of my next increment / the date of my subsequent increment raising my pay to Rs. ___________________ / I vacate or cease to draw pay in the existing pay structure / the date of my promotion/upgradation to the post of _______________________.

We hereby listed down the best benefit option based on the next increment in the below table.  Employee can choose wisely from the below table and apply the same while submitting the “Form of Option”

If you had a promotion cycle between 02-01-2016 to 30-06-2016, we would provide the best option in the coming days.

Also, if there has been any retirement on or before 30-06-2016, you can choose the Option 1 in the “Form of Option” as per rule 6 (2).

 Please post your valuable comments and queries, also suggest you to refer Gazette notification for queries.

Disclaimer: We had done our best to get you the right value, however there could be errors.  We request the readers to validate the information and then act.  We will not take any responsibility for the losses incurred due to errors.

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7th CPC Option Form Ready Reckoner For Grade Pay 1800

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Ready Reckoner – Form of Option Grade Pay 1900

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7th Pay Commission Form of Option Ready Reckoner For Grade Pay 2000

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7th CPC Option Form Ready Reckoner For Grade Pay 2400

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7th CPC Option Form Ready Reckoner For Grade Pay 2800

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7th CPC Option Form Ready Reckoner For Grade Pay 4200

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7th CPC Option Form Ready Reckoner For Grade Pay 5400 (PB 2)

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7th CPC Option Form Ready Reckoner For Grade Pay 4600

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7th CPC Option Form Ready Reckoner For Grade Pay 4800

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7th CPC Option Form Ready Reckoner For Grade Pay 5400 (PB 3)

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7th CPC Option Form Ready Reckoner For Grade Pay 7600

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7th CPC Option Form Ready Reckoner For Grade Pay 8900

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7th CPC Option Form Ready Reckoner For Grade Pay 10000

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Implementation of 7th Central Pay Commission recommendations – Statement of fixation of pay

Implementation of 7th Central Pay Commission recommendations – Statement of fixation of pay

Government of India
Ministry of Railways
Railway Board

S. No. 3/PC/VII

RBE No. 94/2016
No. PC-VII/2016/RSRP/2

New Delhi dated: 03.08.2016

The General Manager
All India Railways &
Production Units
(As per mailing list)

Sub: – Implementation of 7th Central Pay Commission recommendations – Statement of fixation of pay.

Please refer to Railway Services (Revised Pay) Rules, 2016 notified vide GSR No. 746 (E) dated 28.07.2016 forwarded with Railway Board endorsement No. PC VII/2016/RSRP/1 dated 28.07.2016 and further instructions and schedule circulated vide Railway Board’s letter No. PC-VII/2016/RSRP/2 dated 2.08.2016 (RBE No.93/2016).

2. In continuation to the rules/instructions circulated vide Boards’s letter referred above, performa of statement of fixation of pay for fixing the pay of existing employees already in services as on 1.01.2016 while implementing the 7th CPC recommendations is enclosed here with as Annexure ‘A’. Further action to fix the pay may be taken as per the instructions contained in para 6 of Board’s Letter No. PC-VII/2016/RSRP/2 dated 02.08.2016.

This issues with concurrence of Finance Dte of Ministry of Railways

sd/-
(Jaya Kumar G)
Deputy Director, Pay Commission -VII
Railway Board

Download the signed Copy

DA with effect from 1st July 2016

DA with effect from 1st July 2016

DA with effect from 1st July 2016
= [ (263+264+266+269+270+269+269+267+
268+271+275+277)/12]-(261.4)X100/261.4 =  2.91 %

Since 7th Pay Commission  (New Formula)
Month	All India Index	% of Increase
Jan-16	269	0.48
Feb-16	267	0.93
Mar-16	268	1.38
Apr-16	271	1.86
May-16	275	2.4
Jun-16	277	2.91

Revised Statement of fixation of pay under Central Civil Service (Revised Pay) Rules, 2016: issued on 1st Aug, 2016

Revised Statement of fixation of pay under Central Civil Service (Revised Pay) Rules, 2016: issued on 1st Aug, 2016

No.1-5/2016-IC

Government of India/ Bharat Sarkar
Ministry of Finance] Vitta Mantralaya
Department of Expenditure/ Vyaya Vibhag
(Implementation Cell, 7th CPC)

Room No. 214, The Ashok
New Delhi, the 1st August, 2016

OFFICE MEMORANDUM

Subject: Implementation of the recommendations of the 7th Central Pay Commission – fixation of pay and payment of arrears – instructions regarding.

The undersigned is directed to refer to this Ministry’s OM of even number dated 29.07.2016 regarding fixation of pay and payment of arrears and to say that the statement of fixation of pay under Central Civil Services (Revised Pay) Rules, 2016 annexed with the said OM dated 29.07.2016 stands superseded by the statement of fixation of pay under Central Civil Services (Revised Pay) Rules, 2016 enclosed at Annexure to this OM

(R.K Chaturvedi)
Joint Secretary to the Government of India

Statement of fixation of pay under Central Civil Service (Revised Pay) Rules, 2016

According to Para 2 of Ministry of Finance, Department of Expenditure (Implementation Cell, 7th CPC)’s OM No. No.1-5/2016-IC dated 29-07-2016, in pursuance of the CCS (RP) Rules, 2016, appropriate necessary action to fix the pay of the employees covered thereunder in the revised pay structure needs to be carried out forthwith in accordance with the provisions contained therein.The statement of fixation of pay in revised pay structure as per CCS (RP) Rules, 2016 be prepared in triplicate and one copy thereof be placed in the Service Book of the employee concerned and another copy made available to the concerned accounting authorities [Chief Controller of Accounts/Controller of Accounts/Accounts Officer] for post-check

Annexure

Statement of fixation of pay under Central Civil Service (Revised Pay) Rules, 2016

1. Name of the Employee :

2. Designation of the post in which pay is to be Fixed as on January 1, 2016 :

3. Status (substantive/ officiating) :

4. Pre-revised Pay Band and Grade Pay or Scale :

5. Existing Emoluments :
a. Basic Pay (Pay in the applicable Pay Band plus applicable Grade Pay or basic pay in the applicable scale) in the pre-revised structure as on January 1, 2016 :
b. Dearness Allowance sanctioned w.e.f. 01.01.2016 :
c. Existing emoluments (a+b) :

6. Basic pay ( Pay in the applicable Pay Band plus applicable Grade Pay or basic pay in the applicable scale) in the pre-revised structure as on January 1, 2016 :

7. Applicable Level in Pay Matrix corresponding to Pay Band and Grade Pay or scale shown at S.No 4 :

8. Amount arrived at by multiplying Sl. No. 5 by 2.57 :

9. Applicable Cell in the Level either equal to or just above the Amount at Sl. No. 8 :

10. Revised Basic Pay (as to Sl. No. 9) :

11. Stepped up pay with reference to the revised Pay of Junior, if applicable [Rule 7(8) and 7(10) of CCS (RP) Rules, 2016]. Name and pay of the junior also to be indicated distinctly. :

12. Revised pay with reference to the Substantive Pay in cases where the pay fixed in the officiating post is lower than the pay fixed in the substantive post if applicable [Rule 7(11)] :

13. Personal Pay, if any [Rule 7(7) and 7(8)] :

14. Non-Practicing Allowance as admissible at present in the existing pre-revised structure (in terms of para 4 of this OM) :

15. Date of next increment (Rule 10) and pay pay after grant of increment :

Date of Increment Pay after increment in applicable Level of Pay Matrix

16. Any other relevant information :

Date:
Signature & Designation of Head of Department
Office:

Click here for updated Finmin Order

Superseded Annexure:-

Government’s acceptance of 7th CPC recommendation – Modified Assured Career Progression Scheme

Government’s acceptance of 7th CPC recommendation – Modified Assured Career Progression Scheme

No. IV/NFIR/7 CPC(Imp)/2016/MoF

Dated : 02/08/2016

The Cabinet Secretary,
Government of India,
Rastraapati Bhavan Annexie,
New Delhi

Respected Sir,

Sub: Government’s acceptance of 7th CPC recommendation – Modified Assured Career Progression Scheme – reg.

NFIR invites kind attention of the Government to the acceptance of 7th CPC recommendations circulated by the Ministry of Finance (Department of Expenditure) vide Resolution No. 1-2/2016-IC dated 25th July 2016, the Annexure II of which contains the decision in relation to Modified Assured Career Progression Scheme (MACPS) as given below:-

• “While the MACP has been continued to be administered at the intervals of 10,20 & 30 years of service to an employee as was in vogue, the benchmark for performance appraisal under the MACPS has been enhanced from “good” to “very good”.
• It has also been decided by the Government to withhold annual increments in the case of those employees who are unable to meet the benchmark for MACP or on regular promotion within first 20 years of the service of the employee”.

In this connection, NFIR conveys that the Government has not consulted JCM (Staff Side) before taking decision as above although this being one of the issues contained in the Charter of demands, seeking discussion. The decision has caused disappointment among Railway employees and as well Central Government employees. Upgrading the bench mark from “good” to “very good” for granting financial upgradation under MACPS would provide unfettered powers to the superiors to victimize and give scope to favour the liked staff on “pick” and “choose” basis. The decision for withholding annual increments on the pretext that employees are unable to meet the bench mark for MACP or regular promotion within first 20 years of service would not only demoralize the staff but also give handle for willful harassment and victimization by higher Officials.

NFIR, therefore, requests the Cabinet Secretary who is also the Chairman of the JCM, to kindly hold meeting with the Staff Side representatives for resolving the issues amicably through discussions.

Yours sincerely

sd/-
(Dr. M.Raghavaiah)
General Secretary

Source : NFIR

All India General Strike by Central Trade Unions – 2nd September, 2016

All India General Strike by Central Trade Unions – 2nd September, 2016

NO. IV/NIFIR/INTUC/Corres/Part I

Dated : 02/08/2016

The General Secretaries of
Affiliated Unions of NFIR

Brother,

Sub: All India General Strike by Central Trade Unions – 2nd September, 2016 – reg.

The INTUC and other Central Trade Unions in the country have decided to go on One Day General Strike on 2nd September 2016 on 12 Points Charter of Demands submitted to the Central Government as below:-

1. Urgent measures for containing price rise through universalization of public distribution system and banning speculative trade in commodity market.

2. Containing unemployment through concrete measures for employment generation.

3. Strict enforcement of all basic labour laws without any exception or exemption and stringent punitive measures for violation of labour laws.

4. Universal social security cover for all workers.

5. Minimum wage of not less than Rs. 18000/- per month with provisions of indexation (for unskilled worker).

6. Assured enhanced pension not less than 3000 p.m. for the entire working population (including unorganized sector workers).

7. Stoppage of disinvestment in Central/state Public Sector undertakings.

8. Stoppage of contractorisation in permanent/perennial work and payment of same wage and benefits for contract workers as that of regular workers for the same and similar work.

9. Removal of all ceilings on payment and eligibility of bonus, provident fund and increase in quantum of gratuity.

10. Compulsory registration of Trade Unions within a period of 45 days from the date of submitting application and immediate ratification of ILO conventions C-87 and C-98.

11. No. FDI in Railways, Defence and other strategic sectors.

12. No unilateral amendment to labour laws.

In support of one day General Strike, the NFIR affiliates are called upon “to hold demonstrations and rallies throughout the lndian Railways” on 2nd September 2016. A report in this regard should be sent to the Federation latest by 7th September 2016.

Yours fraternally,

sd/-
(Dr. M.Raghavaiah)
General Secretary

Source : NFIR

Banks to launch new loan schemes to grab pay commission arrears

Banks to launch new loan schemes to grab pay commission arrears

New Delhi: State Bank of India, the country’s largest lender, and its rivals are set to launch programmes aimed at encouraging central government employees in line for fatter 7th pay commission arrears to borrow and spend on consumer goods, cars and homes.

The government announced its employees would get the higher salaries from August along with arrears of the first seven months under the Finance ministry Office Memorandum No.1-5/2016-IC issued on Friday. The pay commission award is due from January 1.

Punjab National is also firming up plans to tap salary increases to the tune of a total Rs 70,000 crore through this financial year thanks to the award of the Seventh Central Pay Commission.

State-owned SBI will raise the age bar on loan repayments by five years in the two schemes it’s planning. It will also offer lower interest rates and the flexibility of paying higher installments in the first few years.

“We will launch SBI Privilege to suit the needs of the borrowers who will be benefiting from the pay commission,” SBI managing director Rajnish Kumar told The Economic Times. “This new scheme will allow home loan borrowers to service loans till the age of 75 from the existing age of 70 years besides a five basis point reduction in interest rates if they repay through check-off facility (or payments deducted directly from the salary).” A basis point is 0.01 percentage point.

Another progamme, SBI Shaurya, is aimed at defence personnel, who are also in line for pay and pension increases.

“We expect that the major demand will be from personal loans and car loans,” a Bank of Baroda executive told The Economic Times. “We will be soon be coming out with interesting offers on these two product lines.”

After the sixth pay commission award in 2008, the sales of two wheelers and passenger cars rose 25%. Analysts expect a similar bump, though not as sharp, this time around.

The increase in salary this time is an average 15% compared with 40% last time. Plus, last time the arrears were for two years, resulting in a bigger surge.

Inputs with ET