Despite numerous public complaints, banks are reportedly still debiting premiums for two low-cost insurance schemes launched by Prime Minister Narendra Modi — Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) for life insurance, Pradhan Mantri Suraksha Bima Yojana (PMSBY) for accident insurance, without obtaining prior consent from their customers, according to a media report. A detailed investigation by Article 14 also found that bank employees are being asked to create a paper trail following media exposes and social media complaints. The report has quoted several customers who found unauthorised debits from their bank accounts for these insurance schemes. The premium for the PMJJBY scheme is Rs 436 a year while PMSBY premium is Rs 20 a year. Money has been taken for the Centre’s micro-pension scheme, called Atal Pension Yojana (APY) as well. Article 14 pointed out that this ‘exercise’ prevents the kin of those ‘enrolled’ in these schemes from actually availing the benefits of the premium payment as the customers are unaware that they are paying premiums. Moreover, the policy reports mention bogus nominee names. The banks mentioned in the report include the State Bank of India, Bank of Baroda, Canara Bank, and UCO Bank. The investigative report also cited bank employees’ posts on X where they have stated that it was a routine thing for banks to upload customers’ details in ‘bulk’ into the insurance-activation portal. Screenshots of the bank’s content management system as well as WhatsApp group chats featuring instructions on how to initiate bulk enrolment of customers in PMSBY confirmed the same, the report found. Predatory sales practices like this are prevalent in the banking sector, said Nikhil Parulkar, a forensic accountant and certified fraud examiner, who was quoted in the report. In December 2023, Canara Bank underwent an audit following an Economic Times article on unauthorised debits for PMJJBY and PMSBY. Following this, its branches were told to look at customers’ application forms for these insurance schemes. Citing an unnamed employee, Article 14 claimed that these forms did not exist, and that managers were advising branch heads to falsely confirm that the forms were in place.Article 14 also cited someone it identified as a former Canara Bank employee saying that his regional office had enrolled 50-odd customers of his branch in PMJJBY from the back-end, and had later obtained application forms from most of them. The article also spoke about the pressure on those in the banking sector who are facing the ire of both their management for not meeting enrollment targets and aggrieved customers whose money is being used without their consent. The report also claims that several of these bank employees have posted their grievances on X and there are YouTube videos guiding customers on how to exit these schemes as well.
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