1. Deposit Insurance and Credit Guarantee Corporation (DICGC) is a wholly-owned subsidiary of the Reserve Bank of India (RBI).
2. It was established in 1978 under the Deposit Insurance and Credit Guarantee Corporation Act, 1961.
3. It provides deposit insurance that works as a protection cover for bank deposit holders when the bank fails to pay its depositors.
4. The agency insures all kinds of deposit accounts of a bank, such as savings, current, recurring, and fixed deposits up to a limit of Rs. 5 lakh per account holder per bank.In case an individual’s deposit exceeds Rs.5 lakh in a single bank, only Rs.5 lakh, including the principal and interest, will be paid by DICGC if the bank becomes bankrupt.
What DICGC Does Not Cover?
Deposits of state or Central governments
Deposits from foreign governments
State land development banks depositing with the state co-operative bank
Inter-bank deposits
Funds that are due on account of India and deposits received outside India
Funds exempted by the corporation with the previous approval from RBI
