Defence Pensioners Must Take Action On this Immediately : Letter from IHQ MoD Army

DSP account stands for “Defence Salary Package” account, which is a special type of bank account offered by several banks in India to serving and retired personnel of the Indian Defence Forces, including Army, Navy, and Air Force, as well as their family members. Not only the serving personnel, but the pensioners also comes under the coverage of DSP Pension Account. It has been found that the DSP Account opened during service is continued to drawing pension. In this case, the category of account must be changed. The Pension account must be identified/modified as DSP Pension account. But 99% defence pensioners failed to change the DSP Salary to DSP Pension Account. In this regard Army HQ has issued a letter to all Comd HQ to circulate this msg to all units for change of DSP Salary to DSP Pension Acct on proceeding to Pension.

Firstly we must know the benefits of the DSP account as mentioned below :-

  1. Zero balance account: DSP account holders do not need to maintain any minimum balance in their account.
  2. Free personal accident insurance: Account holders are provided with personal accident insurance coverage up to a certain amount, depending on the bank.
  3. Special interest rates: DSP account holders are eligible for special interest rates on fixed deposits, loans, and other banking products.
  4. Waiver of fees: Account holders are exempt from various fees and charges, including account maintenance fees, ATM withdrawal fees, and chequebook issuance fees.
  5. Loan facilities: DSP account holders can avail themselves of special loan facilities, such as personal loans, home loans, and vehicle loans, with lower interest rates.
  6. Cashback and rewards: Some banks offer cashback and reward points on transactions made through the DSP account.
  7. Easy fund transfer: DSP account holders can easily transfer funds between their accounts and to other accounts through online and mobile banking.

Overall, the DSP account provides various benefits and facilities to the defence personnel and pensioners, which can help them manage their finances more efficiently and effectively.

Copy of the letter issued by AGs Branch, IHQ, MoD (Army) has been forwarded to  all concerned which is reproduced below


Headquarters No/them Command (A) Eastern Command (A) Western Command (A) Southern Command (A) Central Command (A) South Western Comd (A) A&N Command (A) ARTRAC (A) SFC (LV)


1.    PI ref PS Dte letter No 6127087/Advisory/AG/PS-3(P) dt 26 Dec 2022 and even Has di 27 & 29 Dec 2022.

2.   It has come to notice that Def Pars while proceeding on pension do not change their DSP Account (Serving) to DSP Account (Pension). This may result in rejection/ delay in admissibility of PAI claims, nomination claims etc. DSP Acct Code for serving pers is different from DSP Acct Code for pensioners. All ranks are requested to approach concerned Banks with a personal application to change the DSP Code from the date of their discharge/pension.

3.    This fetter may pi be circulated to unit level.

(Rohlt Sharma)
Lt Col
GSO-1 PS-3(P)
For Adjutant General;

You may read the original letter here :

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