Insurance cover also applicable to deposits in co-op banks
MDT/PTI 10 August 2012
The government has suggested DICGC and the RBI to adopt to risk-based deposit insurance premium structure. This will be prior to the DICGC proposal for increasing insurance coverage limit from Rs1 lakh to Rs2 lakh being approved

New Delhi: The deposit insurance coverage is also applicable to all eligible deposits in co-operative banks, Finance Minister P Chidambaram informed Rajya Sabah, reports PTI.
 
According to the existing norms of Deposit Insurance and Credit Guarantee Corporation (DICGC), a wholly-owned subsidiary of the Reserve Bank of India (RBI), a maximum of Rs1 lakh is paid to a depositor in case a bank goes insolvent.
 
"In terms of the provisions of the Deposit Insurance and Credit Guarantee Corporation Act, the deposit insurance coverage is also applicable to the eligible deposits held in all eligible co-operative banks," Chidambaram said in a written reply.
 
He said the government has suggested DICGC and the RBI to adopt to risk-based deposit insurance premium structure. This will be prior to the DICGC proposal for increasing insurance coverage limit from Rs1 lakh to Rs2 lakh being approved.
 
"DICGC has sent a proposal to increase the deposit insurance coverage limit from the existing Rs1 lakh to Rs2 lakh for approval of the government.
 
"The proposal was examined and to rationalise the deposit insurance premium structure, the government has suggested to the DICGC and the RBI to adopt to Risk-Based Deposit Insurance Premium Structure, before the proposal of the DICGC is considered for approval," Chidambaram said.
Comments
deepaksb
1 decade ago
Insurance cover of Rs.2 Lacs is NOT sufficient.

How long back Rs.1 Lac limit was fixed?

What about inflation for all these years ?

Even present insurance cover has lot of strings attached-Limit of insurance applicable to all accounts if a person has multiple joint accounts in same bank with immediate family members.

People who had experienced collapse of banks like South India Co-Op.bank,Globel Trust bank are aware of value of Bank Deposit Insurance.

Insurance cover must be increased to Rs.5 lacs and it should be per account and not per bank/branch.
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