The Haryana government has de-empanelled IDFC First Bank and AU Small Finance Bank for government business with immediate effect. No Government funds will be kept in these two banks. This big decision has been taken by the Haryana Government due to Rs.590 crore fraud in IDFC First Bank.
As per reports, funds of the Haryana Govt were embezzled in the Chandigarh branch of the bank and some employees have been suspended in this matter. From February 18, 2026, certain Haryana government entities approached the bank regarding their respective accounts. During this process, discrepancies were noticed between the account balances held with the bank and those reported by the government entities. [Read full news]
In an official circular, the state government said the two banks have been barred from handling government business in Haryana until further orders. No government funds will be parked, deposited, invested or transacted through these banks going forward. All departments and organisations have been directed to immediately transfer balances and close accounts maintained with them.
The Govt said that further, it has come to the notice of the Finance Department that certain banks are not adhering to the conditions under which fixed deposits are being made by the Departments and Corporations. In several cases, it has been observed that despite clear instructions to place funds in flexible deposits or other fixed deposit instruments offering higher rates of interest, banks are retaining the funds in savings accounts, resulting in lower returns and consequent financial loss to the Government. Many Departments and Corporations are not regularly reconciling their fixed deposit and bank accounts with the concerned banks, leading to non-detection of such irregularities in a timely manner.
In view of the above, all Departments, Corporations, Boards, and PSUs are hereby directed to:
- Ensure that fixed deposits are placed strictly in accordance with the approved terms and conditions.
- Regularly verify and confirm that banks are complying with the prescribed deposit instructions.
- Undertake reconciliation of all fixed deposit and related bank accounts on a monthly basis.
- Immediately take up discrepancies with the concerned banks and report serious deviations to the Finance Department.
Govt directed that all Departments, Boards, and Corporations shall reconcile their respective bank accounts strictly in accordance with the guidelines issued by the Finance Department and complete the process in all respects by 31st March, 2026. A compliance report, duly certified by the competent authority, shall be submitted to the Finance Department by 4th April, 2026.
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