If you have Rs 50 lakh in bank and the bank fails, then you will get only up to Rs 1 lakh as insurance cover according to the Deposit Insurance and Credit Guarantee Corporation (DICGC), a wholly owned subsidiary of the Reserve Bank of India. Not every single rupee you own as deposits will be returned.
Apply to all type of accounts
This covers savings, fixed, current and recurring accounts, the DICGC, which insures all bank deposits, said in response to a Right to Information (RTI) query filed by PTI.
FM planning to raise the cover
Finance Minister Nirmala Sitharaman last month said the government plans to bring in legislation on raising the insurance cover on bank deposits from the current Rs 1 lakh during the winter session of Parliament. Her assertion came days after Sahakar Bharati, a non-profit with many of its office bearers close to the RSS, pitched for an increase in deposit insurance limits to Rs 5 lakh for individuals.
Insurance cover is of Rs 1 lakh only!
The DICGC which insures all bank deposits, also said depositors in failed and liquidated banks will get only up to Rs 1 lakh as insurance cover, regardless of the amount in their accounts.
The corporation covers all commercial banks, including branches of foreign banks functioning in India, local area banks and regional rural banks. All eligible cooperative banks as defined in Section 2(gg) of the DICGC…
A bank is a financial institution that accepts deposits from the public and creates credit. Lending activities can be performed either directly or indirectly through capital markets. Due to their importance in the financial stability of a country, banks are highly regulated in most countries.