Bank DA May 2025

Bank DA May 2025: DA Slashed by 1.23%, Latest CPI Data Released

 

In a key update for employees and pensioners in the banking sector, the Indian Banks’ Association (IBA) has announced the Dearness Allowance (DA) for the quarter beginning May 2025.

 

 Based on the Consumer Price Index for Industrial Workers (CPI-IW), the DA has been reduced by 1.23%, bringing it down from 21.20% to 19.97%.

 

CPI-IW Index (Base Year 2016 = 100) – Key Data for the Quarter:

 

DA Calculation Summary:

 

Average Index for Jan–Mar 2025: 143.00

 

Index points above base (123.03): 19.97

 

DA payable from May 2025: 19.97%

 

DA paid for previous quarter (Feb–Apr 2025): 21.20%

 

Change in DA: -1.23%

 

Impact Analysis

 

This reduction of 1.23% in DA comes as a disappointment for bankers who have been closely tracking inflation trends. 

 

The CPI-IW index, although stable, witnessed a marginal drop in February 2025, which ultimately affected the quarterly average.

 

The decline reflects subdued inflation levels in recent months. 

 

While a stable inflation rate is generally good for the economy, it does impact the salary adjustments tied to cost-of-living indices.

 

Why Did the DA Drop?

 

The CPI-IW figures released by the Labour Bureau indicate that:

 

Inflation remained largely flat over the January–March 2025 period.

 

February 2025 recorded a slight dip in the index at 142.80, pulling the average down.

 

With the DA calculation formula directly tied to the CPI-IW, even minor fluctuations affect the final allowance.

 

What This Means for Bank Employees and Pensioners

 

For employees and retirees under the 11th Bipartite Settlement and other wage revision frameworks, this DA reduction will reflect in salaries and pensions starting May 1, 2025.

 

Looking Ahead

 

Though the current reduction may seem discouraging, it’s important to view it in context. 

 

The DA rate is still significantly higher than the base reference point, and any future increase in inflation could reverse the trend in the next quarter.

 

Conclusion

 

The May 2025 DA update signals a minor downward adjustment aligned with inflation trends. 

 

Bank employees and pensioners are advised to monitor future CPI-IW releases for indications of where DA may head in the coming quarters.

 

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