DFS gives detailed reply to 12 questions raised by Akhilesh Yadav

Samajwadi Party Leader Akhilesh Yadav had raised 12 questions against the Modi Government and alleged that BJP led government has made Banking worse than ever. Now DFS has given point wise reply to the 12 questions raised by Ex-CM of Uttar Pradesh.

First read the 12 questions asked by Akhilesh Yadav

1. Why did the BJP government carry out the loot of billions of rupees by deducting penalties from ordinary people’s accounts?
2. Why did the BJP start arbitrary collections every month in the name of new charges for various services like SMS fees, ATM fees, account maintenance fees? Why defame small borrowers by sending recovery agents to their homes for just a few thousand rupees? On the other hand, why engage in the corruption of waiving off trillions of rupees in loans taken by billionaires?
3. Why reduce the money that reaches the hands of helpless people who sustain their lives on the interest earned from their savings and pension deposits? Why cut interest rates?
4. Why corrupt the banking system by playing the game of note exchange in the name of demonetization? Why make ordinary people and even elderly women stand in lines to exchange their hard-earned savings? In contrast, why allow black money to be laundered into white through backdoor deals with fixed commissions?
5. Why have valuable metals, investment certificates, and other heirlooms from people’s bank lockers started disappearing suddenly over the past 12 years? Why collect crores through stamp papers from the public in the name of locker agreements? Why increase locker rent every year? Why demand several years’ rent in advance, but only guarantee up to 5 lakh rupees in case of theft?
6. What is the secret behind repeatedly staging the KYC drama to trap people’s money? What is the reason for online KYC failures? Why threaten account closure without KYC? Who will answer for the difficulties faced by the elderly due to mismatched fingerprints or iris scans preventing KYC? What are the poor souls supposed to do when their pensions stop or deposits get stuck because of this?
7. Why deliberately make banks sick? Why systematically defame honest and dedicated bank employees by accusing staff of slacking off? Why weaken reliable banks for years under the guise of problems like server downtime, faulty printers, OTP delays, or “too much work today, come back tomorrow,” and why arrange to sell banks for commissions?
8. Under the name of digital banking, why is there no one listening to the public’s troubles? Why isn’t there a direct contact person for issues like online deductions or banking fraud? Why do customer care lines never connect, and why is no one accountable for refunding deducted money? Why not run security shields and awareness campaigns to prevent the misuse of innocent people’s accounts for fraud?
9. Why the discrimination in loans? Ordinary people run around in circles for Aadhaar, PAN, guarantors, and CIBIL scores just to get a loan of a few lakhs for children’s education, housing, or business expansion, while a few corrupt individuals collude to easily take out billions in loans from banks and then flee.
10. Whose pockets benefit from forcibly selling insurance in the name of opening an account? Why pressure people to buy insurance policies, credit cards, or fixed deposits just to open an account?
11. Why does the government ignore demands related to bank employees’ working conditions, service terms, and dealing with frustrated customers’ irritation? Why do bank employees have to go on strike every time because of this? Why not adopt a sympathetic attitude toward bank workers? The truth is that whether it’s urban or rural banking problems, they are the ones who have to face everyone’s complaints and public outrage, which sometimes leads to humiliating and violent situations.
12. Why does the BJP government, in its gross neglect of bank customers and those working in banks, treat them with such contemptible, shameful, and deplorable behavior?

Now Read reply by DFS

1. Zero-Balance Accounts and Minimum Balance Charges

Banks offer Basic Savings Bank Deposit (BSBD) accounts that do not require customers to maintain a minimum balance. These accounts provide basic banking facilities, such as depositing and withdrawing money and using an ATM card, free of charge. More than 59 crore accounts have been opened under the Pradhan Mantri Jan Dhan Yojana (PMJDY), launched in August 2014. These accounts do not require a minimum balance, and no penalty is charged if the balance is zero. The scheme has played a major role in financial inclusion by facilitating Direct Benefit Transfer (DBT), access to credit, social security benefits, and savings and investment.

To promote financial inclusion and customer-friendly banking, most public sector banks have also removed or reduced minimum-balance charges on their regular savings accounts. Regarding the conduct of recovery agents, the Reserve Bank of India (RBI) has clearly stated that they cannot threaten, intimidate, or harass customers. To extend banking services to every village, banking service centres have been established within a five-kilometre radius, connecting villages across the country to banking outlets. The government has also introduced strict laws to deal with major fraudsters and loan defaulters. Such cases are reported to the Central Bureau of Investigation (CBI), while money-laundering cases are referred to the Enforcement Directorate (ED), and strict action is taken against those involved.

2. Interest Rates and Inflation

Over the past three decades, interest rates have been influenced by inflation and market conditions. In a developing economy, interest rates generally decline gradually but can rise sharply during periods of high inflation. For example, between 2010 and 2014, inflation was so high that depositors suffered losses in real terms despite receiving comparatively high nominal interest rates. In 2013, the interest rate on deposits under the Senior Citizens Savings Scheme (SCSS) was 9.2%, while inflation was 9.5%, resulting in a negative real interest rate.

The government says it has brought inflation under control. In 2026, the SCSS interest rate is 8.2%, while inflation is approximately 5%, providing depositors with a positive real return of around 3.2 percentage points. Loan interest rates have also declined from over 10% in 2013 to around 7.5% or lower. This has reduced EMIs by approximately 15% and eased the financial burden on borrowers. Facilities such as Digital Life Certificates and doorstep banking have also been introduced for senior citizens. Overall, the government says the balance between interest rates and inflation is now more favourable to both depositors and borrowers, helping them meet their regular financial needs.

3. Demonetisation

The government describes demonetisation as an important economic decision aimed at curbing black money, counterfeit currency, and illegal cross-border financing. According to the government, the move helped bring more transactions into the formal financial system and encouraged the adoption of digital payment methods such as UPI. By formalising economic activity and expanding digital infrastructure, demonetisation helped connect India’s large informal economy with the formal banking system and promoted long-term transparency.

Strict safeguards were also introduced to prevent the conversion of illegal money into legitimate funds. Large amounts of cash had to be deposited directly into bank accounts, and people were required to provide details using a PAN card or valid identity document when exchanging notes at bank counters. The government says its core principle is citizen-centric governance.

4. Bank Locker Security

The government says strict arrangements have been introduced to improve the security of bank lockers. Lockers are kept in secure vaults or strong rooms, with facilities such as CCTV cameras, alarm systems, regular audits, and SMS or email alerts whenever a locker is operated. Under RBI’s Master Directions, banks bear the stamp paper expenses involved in executing revised locker agreements for existing customers.

Locker charges are described as nominal and are not revised every year; they generally remain unchanged for several years. Loss of articles kept in bank lockers is considered an exceptional occurrence. However, if a loss occurs due to a deficiency in the bank’s service, the bank is responsible for compensating the customer. Under current RBI rules, the compensation may be up to 100 times the annual locker rent.

5. KYC Requirements and Customer Convenience

The RBI has issued Know Your Customer (KYC) guidelines to prevent financial fraud and terrorist financing. Various documents can be used for KYC, and customer records are updated periodically to ensure that the information remains relevant. KYC can be updated at a branch or without visiting one. Banks have introduced facilities such as video KYC and home-based KYC through digital channels to make the process more convenient.

According to the government’s response, KYC updates for many accounts, including Jan Dhan accounts, may be required only once every eight to ten years. If a senior citizen’s fingerprints or iris scan cannot be matched, banks can update KYC through offline verification or by obtaining a copy of another recognised identity document. The government also says EASE reforms have improved customer service, technology, and risk management. The nomination process has been simplified to allow up to four nominees, making claim settlements easier. KYC procedures are also becoming simpler and more digital.

6. Reforms to Strengthen Public Sector Banks

The government says it is committed to strengthening banks through better governance, improved customer service, technological modernisation, and greater operational efficiency. Under the Enhanced Access and Service Excellence (EASE) agenda and other governance and structural initiatives, comprehensive reforms have been introduced to improve the efficiency, risk management, and credit discipline of public sector banks (PSBs).

In 2014-15, the Indian banking sector, particularly public sector banks, faced considerable pressure because of rising levels of bad loans. The government says it took extensive measures to address the problem. As a result, public sector banks recorded their highest-ever net profit of ₹1.98 lakh crore in FY 2025-26. Their Gross Non-Performing Asset (GNPA) ratio declined to 1.93% as of March 31, 2026, its lowest level in several decades, according to the response.

The government attributes this improvement to cleaner balance sheets and stronger credit growth. It says PSBs have improved their financial and operational performance, returned to profitability, and strengthened their capital positions. The restructuring of Regional Rural Banks (RRBs) has also achieved the objective of “One State, One RRB”. RRBs recorded their highest-ever profit of more than ₹10,000 crore in FY 2025-26. The government also acknowledges the contribution of bank employees and says transparent rules are in place to ensure that employees are not unfairly penalised.

7. Reporting Digital Banking Fraud

Customers can report digital financial fraud through the national helpline number 1930 or through their banks’ own channels, including call centres and branches. The RBI and banks conduct awareness campaigns through advertisements, SMS, WhatsApp, email, and other communication channels to promote safe digital banking and prevent fraud.

The government says India’s Digital India systems are gaining global recognition. UPI has created a fast payment system, and India now processes more than 80 crore UPI transactions daily. According to the response, UPI accounts for approximately 49% of global real-time payment transaction volume and has expanded to 11 countries. Several safeguards have been introduced to prevent fraud, including two-factor authentication, transaction alerts, and systems to identify suspicious activity.

The National Payments Corporation of India (NPCI) has introduced device binding between mobile numbers and devices, PIN-based two-factor authentication, and daily transaction limits for UPI transactions. RBI guidelines also provide safeguards against unauthorised electronic banking transactions, including rules relating to customer responsibility and compensation.

To tackle cyber financial fraud, the Citizen Financial Cyber Fraud Reporting and Management System (CFCFRMS) has been developed and implemented. It helps banks block fraudulent transactions quickly through the banking network, improving the chances of protecting and recovering victims’ money. The system also includes a Money Restoration Module (MRM) and a Grievance Redressal Module (GRM) to support timely complaint resolution and faster recovery of money by victims.

8. Loan Approvals and Credit Facilities

The government says banks provide credit according to their board-approved policies, without discrimination. The RBI regulates and supervises lending, and its due diligence and credit appraisal requirements apply equally to all loan applicants. However, banks have taken steps to simplify and speed up the approval of small-ticket loans, including some simplification of due diligence procedures.

The government has launched several schemes to provide collateral-free loans to farmers, small businesses, street vendors, artisans, and entrepreneurs. These include the Pradhan Mantri Mudra Yojana, Kisan Credit Card (KCC), PM SVANidhi, PM Vishwakarma, and Stand-Up India. Under the Pradhan Mantri Mudra Yojana, more than 60 crore loan accounts have received approvals for loans worth over ₹43 lakh crore, supporting small entrepreneurs and self-employment without collateral.

The PM SVANidhi scheme has provided street vendors with affordable loans on easier terms. The scheme has been extended until 2030 and includes a provision for a UPI-linked RuPay credit card. More than one crore loans have been sanctioned under the scheme. The PM Vishwakarma scheme supports artisans in 18 traditional trades by providing modern tools and access to new markets. More than six lakh beneficiaries have received loan approvals worth over ₹5,000 crore.

Under the New Credit Assessment Model, more than nine lakh MSME accounts have received loan approvals worth over ₹1.32 lakh crore. The government has also introduced credit cards with limits of up to ₹5 lakh for micro-enterprises. The Emergency Credit Line Guarantee Scheme has provided targeted credit guarantee support to businesses affected by external disruptions. The government says strict laws are in place to deal with major fraudsters and loan defaulters, and action is taken against those involved.

9. Mis-selling of Insurance Policies

The government says insurance policies distributed by banks are offered only with customers’ consent. The RBI sets guidelines for banks selling insurance products. If a complaint of mis-selling is received, it is addressed through the bank’s grievance redressal system and the applicable regulatory framework.

To expand social security coverage among ordinary citizens, the government launched the Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) in 2015. These schemes provide low-cost, affordable insurance coverage. According to the response, more than 27 crore people have enrolled in PMJJBY and more than 58 crore in PMSBY. The Atal Pension Yojana has also crossed 9.5 crore subscribers.

10. Welfare and Service Conditions of Bank Employees

The government says it is committed to the welfare of public sector employees. Employees of public sector banks receive good salaries and enjoy respect in society, according to the response. The government says it has made sustained efforts to resolve human resource issues affecting public sector bank employees and that most of their demands have been fulfilled.

Over the past 12 years, public sector banks have recruited approximately five lakh employees. The government also says it has taken steps through democratic and participatory processes to ensure regular and timely revisions of salaries and related benefits. Systems governing recruitment, promotions, and transfers have been strengthened to improve transparency.

11. Zero-Balance Accounts and Financial Literacy

Banks offer zero-balance savings accounts, including Basic Savings Bank Deposit Accounts (BSBDA) and accounts opened under the Pradhan Mantri Jan Dhan Yojana. These accounts aim to ensure that everyone, particularly people with limited access to banking and those from weaker sections, can use affordable and accessible banking services. The government says Jan Dhan accounts do not attract penalties for maintaining a zero balance.

Banks regularly conduct awareness campaigns to promote financial literacy, financial inclusion, safe digital banking, and customer convenience. These activities include camps at Gram Panchayat level, mass-media campaigns, SMS, and email communication. Financial Literacy Centres (FLCs) organise special camps for different groups and provide information in regional languages. The RBI also conducts Electronic Banking Awareness and Training (e-BAAT) programmes.

The Kisan Credit Card and agricultural credit schemes have helped small farmers access affordable loans, including for dairy farming, poultry, and fisheries. Agricultural credit disbursement reached ₹30 lakh crore in FY 2025-26, while more than 7.28 crore KCC accounts remained active. Under Stand-Up India, more than 2.7 lakh loans have been sanctioned for people from Scheduled Castes and Scheduled Tribes and women entrepreneurs. Women entrepreneurs accounted for 82% of these loans, according to the government’s response.

12. Overall Progress of the Banking Sector

The government says the 12 explanations demonstrate that India’s banking system has become stronger, more accessible, and increasingly responsive to public needs. According to the response, continuous government intervention and banking reforms have helped public sector banks reduce their GNPA ratio to 1.93% as of March 2026. In FY 2025-26, PSBs recorded their highest-ever net profit of ₹1.98 lakh crore, while their total business reached ₹283 lakh crore.

Financial inclusion initiatives have also benefited ordinary citizens. These achievements include more than 59 crore Jan Dhan accounts, over 59 crore Mudra loans, and more than 24,000 crore UPI transactions in FY 2025-26, as stated in the response. The government further states that India’s Financial Inclusion Index rose from 43.4 in 2017 to 70.0 in 2026, reflecting the expansion of financial services and access to banking.