How DA is calculated for Bank employees?
Dearness Allowance (DA) for bank employees is calculated every quarter using the All-India Consumer Price Index (AICPI) published by the Ministry of Labour, Government of India. Under the 12th Bipartite Settlement, the formula is: DA% = Quarterly average AICPI (Base 2016=100) − 123.03, where 123.03 is the link point agreed at the time of settlement.
Current DA: 25.00% (Feb–Apr 2026). Formula: Quarterly avg CPI (2016=100) − 123.03. DA is payable on Basic Pay + Special Allowance (SA) + PQP + stagnation increment. Revised quarterly — in February, May, August, and November.
DA for Bank employees is revised every quarter, which increases or decreases based on the CPI (Consumer Price Index. Consumer Price Index is released by Ministry of Labour, Govt. of India on monthly basis ).
Here is how to calculated DA for bank employees:
Your exact monthly DA based on Basic Pay, SA, PQP — 12th BPS formula, updated for Feb–Apr 2026.
Calculate DA →Full 12th BPS salary slip — Basic, DA, HRA, PQP, gross and take-home for all scales and cadres.
Calculate Salary →Step 1 : Collect the month wise CPI data for last quarter (Jan-Mar, Apr-Jun or Jul-Dec).
Step 2 :The CPI is converted using conversion factor 4.63 and 4.93 and 2.88 to link the same to base year 1960.
For example CPI for Jul, Aug and Sep 2022 was 129.90, 130.20 and 131.30.
By applying conversion factor
| Jul | Aug | Sep |
| 129.90 x 4.63 x 4.93 x 2.88 | 130.20 x 4.63 x 4.93 x 2.88 | 131.30 x 4.63 x 4.93 x 2.88 |
| 8,539.44 | 8,559.16 | 8,631.48 |
Average CPI works our to 8,576.69 [(8539.44 + 8559.16 +8631.48)/3]
Step 3 : Deduct 6,352 slabs from average CPI (calculated in step 2). This works out to 2224.69
Step 4: Divide 2224.69 by 4 to convert to quarterly DA slabs [2224.69/4 = 556] as the figure is annual.
Step 5: According DA slab for next quarter will be 556 on which 0.07% is payable as DA.
So DA payable for next quarter (Nov to Jan 23) will be 38.92%.
By deducting the same from previous quarter DA, increase in DA can be calculated.
Read: Charter of demands for 12th Bipartite Settlement
DA is calculated based on CPI data of quarter ending one month before the quarter for which DA is payable because CPI data is released by Ministry of Labour on the last day of next month.
DA is revised for bankers every quarter i.e., Feb-Apr, May-Jul, Aug-Oct and Nov-Jan.
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