In a bid to support the distressed customers of banks that collapse or are duped by financial frauds, the Centre on Wednesday, 28 July, cleared amendments in the Deposit Insurance Credit Guarantee Corporation (DICGC) Act to provide the depositors an insurance of Rs 5 lakh within 90 days after the bank is placed under moratorium by the RBI.
"Deposit Insurance Credit Guarantee Corporation was created in case people faced difficulties after RBI imposes moratoriums on banks. Today's Cabinet meeting has decided that within 90 days, depositors will receive Rs 5 lakhs of their money," Union Minister Anurag Thakur said in a press briefing.
Finance Minister Nirmala Sitharaman said that 98.3 percent of all deposits will get covered and in terms of deposit value, 50.9 percent will be covered.
The move comes as a relief to the customers of banks placed in moratorium by the Reserve Bank of India (RBI), if they run into financial troubles.
DICGC is a subsidiary of the RBI that was established in 1978 to provide insurance of deposits such as saving, fixed, current and recurring.
(With inputs from ANI)
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