Question
Under the Deposit Insurance and Credit Guarantee Corporation Act, 1961, each depositor in an insured bank is entitled to a maximum insurance cover of:
Solution
The DICGC insures each depositor for a maximum of â‚ą5,00,000 (Rupees Five Lakhs) per bank, covering both principal and interest, held in the same right and same capacity as on the date of liquidation, cancellation of licence, or imposition of All Inclusive Directions by the RBI. The insurance limit was raised from â‚ą1 lakh to â‚ą5 lakh in February 2020. The insurance premium is paid by the bank, not by the depositor, and cannot exceed 12 paise per annum per â‚ą100 of assessable deposits.
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