Finance Minister Nirmala Sitharaman on Wednesday introduced that the Union Cabinet cleared the Deposit Insurance Credit Guarantee Corporation (DICGC) Bill 2021, which would supply account holders an quantity of as much as Rs 5 lakh inside 90 days of financial institution failure.
The DICGC Bill insures all financial institution deposits and covers all industrial banks, the minister stated including that even overseas financial institution branches in India are lined underneath it.
Under the DICGC, every depositor’s financial institution deposit is insured as much as Rs 5 lakh in every financial institution (for each principal and curiosity). The enhance of insured quantity from Rs 1 lakh to Rs 5 lakh will cowl 98.3 per cent of all deposit accounts and 50.9 per cent of deposit worth, Sitharaman famous.
“Normally, it takes 8-10 years after full liquidation to get cash underneath insurance coverage; however now, even when there’s a moratorium, inside 90 days, the method will certainly be accomplished, giving aid to depositors, the finance minister stated.
The modification to the DICGC Act, 1961 is the finances announcement made by the finance minister.
The authorities had final yr raised insurance coverage cowl on financial institution deposit by five-folds to Rs 5 lakh to offer assist to the depositors of struggling lenders like Punjab and Maharashtra Co-operative (PMC) Bank. Following the collapse of PMC Bank, personal sector lender Yes Bank and Lakshmi Vilas Bank too got here underneath stress, resulting in restructuring by the regulator and the federal government.
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