Bank Deposit Insurance: Now a provision has been made to pay up to Rs 5 lakh to customers in case of bank sinking or bankruptcy. Earlier, in case of bank sinking or bankruptcy, the depositor used to get only up to Rs 1 lakh.
New Delhi. If you also want to get strong returns in a safe way by investing in Fixed Deposits, then this news is for you only. Small finance is giving more returns on FD than many popular and big banks. Some Small Finance Banks are also offering 9% and above returns on FDs to senior citizens.
Now the question arises whether it is safe to keep money in Small Finance Bank? In case of bank collapse or bankruptcy, the only relief the depositor has is the insurance cover provided by the Deposit Insurance and Credit Guarantee Corporation ie DICGC (Deposit Insurance and Credit Guarantee Corporation). Now the insurance cover under DICGC has been increased from Rs 1 lakh to Rs 5 lakh.
How does Deposit Insurance work?
DICGC cover is available for all banks. However, they have to register for this facility and pay the insurance premium. As per DICGC guidelines, each depositor in the bank is insured up to a maximum of Rs 5 lakh for the amount of principal and interest with him on the date of cancellation of the license of the bank or on the day of merger or reconstruction. This means that no matter how much money is deposited in the same bank by combining all your accounts, you will get an insurance cover of only Rs 5 lakh. This amount includes both the principal amount and the interest amount. If your principal amount is Rs 5 lakh in case of bank failure, you will get back only this amount and not the interest.
DICGC insurance cover is available on these accounts
The insurance cover provided by DICGC works on deposits like savings accounts, FDs, current accounts, RDs today. DICGC’s Deposit Insurance covers all insured commercial banks including LABs, PBs, SFBs, RRBs and Cooperative Banks. As on March 31, 2021, the number of insured banks registered with DICGC stood at 2,058. It consists of 139 commercial banks, of which 43 are RRBs, 2 local area banks, 6 payments banks and 10 small finance banks. Apart from this, 1,919 cooperative banks are also registered, including 34 State Cooperative Banks (STCBs), 347 District Central Cooperative Banks (DCCBs) and 1,538 Urban Cooperative Banks.
If your money is deposited in a bank, you can check whether it is registered for Deposit Insurance or not by clicking on the link given below…
Here is the link- https://www.dicgc.org.in/FD_ListOfInsuredBanks.html
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