According to a report by Article-14.com, some banks in India are allegedly withdrawing money illegally from customers’ accounts for the government’s insurance schemes without their consent. Many account holders have reported unauthorized debits from their bank accounts for the central government’s insurance schemes.
The banks have enrolled customers in the life insurance scheme Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and the accident insurance scheme Pradhan Mantri Suraksha Bima Yojana (PMSBY) without their consent. Similar issues were reported with the micro-pension scheme called Atal Pension Yojana (APY). These welfare schemes were launched by Prime Minister Narendra Modi in May 2015 to provide financial security to the poor.
The premium for PMJJBY is ₹436 per year, and ₹20 per year for PMSBY. PMJJBY offers a cover of ₹2 lakh to a nominee in the event of the policyholder’s death, and PMSBY provides a cover of ₹2 lakh in case of death due to an accident and ₹1 lakh in case of a severe accident injury. Under APY, a policyholder receives a monthly pension of up to ₹5,000 after reaching the age of 60.
According to the report, bank staff enter fabricated data, including bogus nominees, to activate the insurance schemes without the consent of the policyholder or account holder. The report claims that the banks adopted these fraudulent practices due to government pressure.
Many of those enrolled in the insurance schemes without consent are unaware that they are paying premiums, which prevents their family members from availing the benefits of the schemes. The report also suggests that these fraudulent practices have been institutionalized, with regional, zonal, and head offices involved in executing these frauds and forcing branches to conceal them.
