What is DICGC?

DICGC stands for Deposit Insurance and Credit Guarantee Corporation. It is a wholly-owned subsidiary of the Reserve Bank of India (RBI).

How does DICGC safeguard your deposits?

• It provides deposit insurance as a protection cover for bank deposit holders.

• If a bank goes into liquidation, DICGC is liable to pay each depositor through the liquidator after exercising proper set-off of dues, if any, and clubbing of deposits in the same capacity and same right.  

• Each depositor is insured for both principal and interest held by him / her in the same capacity and with the same rights as on the date of liquidation/cancellation of the bank's license or the date on which the scheme of amalgamation / merger / reconstruction comes into force.

• The deposits kept in different bank branches are aggregated for insurance coverage.

What does DICGC insure?

Deposits such as savings, fixed, current, recurring, etc., are insured except for the following types of deposits:

• Deposits of Foreign Governments

• Deposits of Central/State Governments

• Inter-bank deposits

• Deposits of the State Land Development Banks with the State cooperative bank

• Any amount due on account of any deposit received outside India

• Any amount which has been specifically exempted by the corporation with the previous approval of the Reserve Bank of India

What is the maximum deposit amount insured by DICGC?

DICGC provides insurance coverage up to ₹5 Lakh per depositor per bank across all existing accounts. This includes principal and interest amounts. Let's understand it with two scenarios:

• Scenario 1: If Mr. A had ₹2.5 Lakh in his bank account at the time of the bank's liquidation, DICGC will pay ₹2.5 Lakh only.

• Scenario 2: If Mr. B had ₹5 Lakhs in his bank account and the accrued interest was ₹4,500, DICGC will pay ₹5 Lakh only.

How can you maximize DICGC Deposit Insurance Coverage?

By holding accounts in different capacities and holdings – in the name of different individuals within the family, in joint holdings in various combinations, or as a guardian of the minor.