The Modi government is going to take a big step to secure the hard earned money in the bank of the common man. The government has proposed an amendment to the DICGC (Deposit Insurance and Credit Guarantee Corporation) Act.
New Delhi: The Modi government is going to take a big step to secure the hard earned income of the common man in the bank. The government has proposed an amendment to the DICGC (Deposit Insurance and Credit Guarantee Corporation) Act. This will lead to insurance protection on depositors of banks in a crisis up to Rs 5 lakh. The government can introduce an amendment bill in the law in the monsoon session of Parliament that guarantees a safe withdrawal of up to 1 limit of the money held by the bank’s money in case of a bank crisis.
In the budget, the government had proposed to amend the Deposit Insurance and Credit Guarantee Corporation (DICGC) Act, to increase the protection of insurance on the deposit amount by 5 times to Rs 5 lakh.
Depositors relief
In the budget speech in February, Finance Minister Nirmala Sitharaman had said – I will present the amendment of DICGC Act-1961 (DICGC Act-1961) in this session. With this, these provisions can be rationalized. This step will provide relief to the depositors of those banks, which have been in crisis in recent times. DICGC is a wholly owned subsidiary of the Reserve Bank of India. It provides insurance cover on bank deposits.
Insurance Guarantee of Rs 5 Lakhs
Its objective is to ensure easy and timely return of their funds to the banks under the Bank Deposit Insurance Scheme. Such measures were increasingly being considered after the sinking of the Punjab and Maharashtra Co-operative Bank (PMC) bank and the crisis of some other banks. The guarantee of insurance-protection on the amount deposited in the bank was increased from Rs one lakh to Rs 5 lakh last year.
Draft bill
To make the system more comfortable and smooth, the Finance Minister Nirmala Sitharaman has proposed to amend the DICGC Act, 1961 in the budget speech itself. According to sources, the draft of the bill has been almost fixed. This can be presented in the forthcoming monsoon session of Parliament after the approval of the Cabinet.
The government gave a guarantee
The amended law will bring great relief to thousands of people whose money is trapped in drowned or decaying banks like PMC. Punjab and Maharashtra Co-operative (PMC) Bank, Yes Bank and Laxmi Vilas Bank are stranded by thousands of customers due to the crisis. In view of such ambiguities, the government is ensuring the guarantee of safety to the customer.
