In order to enhance the performance of employees in Public Sector Banks (PSBs), the Performance Linked Incentive (PLI) scheme was introduced as per the Bipartite Settlement/Joint Note signed on 11th November 2020. The PLI scheme, effective from the financial year 2020-2021, aimed to reward employees based on the growth in operating profit.
Expanding Performance Parameters
To further improve the effectiveness of the PLI scheme, it was recognized that additional performance parameters should be included. In a meeting held on 15th June 2024 between the Negotiating Committee of the Indian Banks’ Association (IBA), United Forum of Bank Unions (UFBU), and other Unions and Associations, it was decided to introduce new metrics based on select performance parameters. These parameters are to be implemented by banks, with approval from their appropriate authority, effective from the financial year 2023-2024. The following performance parameters were identified:
- CASA (Current Account and Savings Account) growth
- Non-Performing Assets (NPA)
- Special Mention Accounts (SMA)
- Non-Interest Income
- Total Business
- Profitability
- Return on Assets (ROA) / Return on Equity (ROE)
- Government Schemes
Calculation of PLI
Under the new metrics, the salary components specified in the Bipartite/Joint Note dated 11th November 2020 will be payable for a specific number of days, ranging from 0 to a maximum of 15 days. The number of days will be determined based on the performance achieved in the identified metrics.
