Pension: Kotak Mahindra Bank Receives Approval to Pay Pensions

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Kotak Mahindra Bank has received approval to act as the authorized bank for the payment of pensions. That means retirees can now open their retirement accounts with Kotak Mahindra Bank.

A memorandum from the Treasury Department states: “It is notified that by letter dated 02/23/2022, the Central Pension Accounting Office (CPAO) has given its approval to Kotak Mahindra Bank to commence its pension payment functions in accordance with the guidelines set out in the program booklet .”

The CPAO acts as a liaison between the Pension Sanctioning Authority (the office where a government employee retired or died) and the Pension Paying Authority (paying and billing agent) and the Pension Paying Bank. The CPAO issues Special Sealing Authorities (SSAs) that permit the payment of annuities in new and revised annuity cases to the CPPCs (Central Annuity Processing Centers) of annuity-paying banks based on annuity cases received from PAO in accordance with the CPAO FAQs.

The approval was obtained on the basis of Kotak Mahindra Bank’s approval to act as the authorized bank for the payment of pensions.

The Reserve Bank of India has given the bank the necessary approvals to begin reporting transactions processed by its Central Pension Processing Center (CPPC) for the daily settlement of pension cases, the Treasury Office’s office said in the memorandum .

According to RBI, “pension-paying banks will credit the pension amount to pensioners’ accounts based on instructions from the relevant pension payment authorities.”

According to the current RBI master circular, “it was decided to discontinue the procedure for forwarding government decrees regarding fee reductions etc. to the banks of the pension payment offices. Agency banks can therefore respond to copies of government orders mailed, faxed, e-mailed to them by the government or accessed from the website and authorize their pension-paying branches to make payments to pensioners promptly.”

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