If you work in a bank, are a bank employee, or know someone who does, this news is very important for them. The government has announced a slight increase in dearness allowance (DA) for bank employees. So, how much will their salaries increase? Let's take a closer look at this.

How much increase in Dearness Allowance (DA)?

For the May-July 2026 quarter, the government has decided to increase the dearness allowance (DA) of bank employees from 25 percent to 25.70 percent. However, bank employees and their unions have called this 0.70 percent increase "too meager." But how much will this increase represent in basic salary?

How much will the salary increase be?

This 0.70 percent increase will increase the monthly salary of employees in different pay scales by only ₹435 to ₹1,050. For employees whose basic salary is between ₹48,000 and ₹117,000, the revised DA means an increase of ₹435 to ₹1,050. While this increase isn't significant, it ensures that employees' allowances remain in line with inflationary trends.

Whose salary will increase and by how much?

Phase 1 – Increase of only ₹435 per month on basic salary of ₹48,480.

Phase 10 – Increase of only ₹601 per month on basic salary of ₹67,160.

Phase 20 – Increase of only ₹838 per month on basic salary of ₹93,960.

Phase 25 – Increase of ₹965 per month on maximum basic salary of ₹1,08,260.

What was the calculation based on? According to a notification issued by the Indian Banks' Association (IBA) on May 2, the updated DA figures are based on the All India Average Consumer Price Index for Industrial Workers (AIACPI-IW) for the quarter ending March 2026. This index will serve as a benchmark for periodic changes in DA.

The CPI figures for the first quarter of 2026 were as follows: DA was 148.6 in January 2026; it slightly decreased to 148.5 in February 2026; and then, it increased to 149.1 in March 2026. The average CPI for these three months is 148.73. Compared to the CPI 2016 base index of 123.03, the difference is 25.70. Accordingly, the DA increase for the period from May to July is 0.70 points.

PC: Navarastra