Even as an RTI query revealed that DICGC a wholly owned subsidiary of RBI has no information on the much-debated issue of hiking the insurance limit on bank deposits, Minister of State for Finance Anurag Thakur gave figures of the amount collected by it in the Upper House on Tuesday.
Answering through a written reply Thakur said “The Deposit Insurance and Credit Guarantee Corporation (DICGC) has collected Rs 88,523 crore as premium from banks, and the total payout to depositors of failed commercial banks on account of claims stood at Rs 296 crore, the Rajya Sabha was informed.
The DICGC, a wholly-owned subsidiary of the Reserve Bank of India (RBI), provides insurance for bank deposits up to the limit fixed by the Corporation. Whether the government will consider hiking the insurance cover cap that was revised more than 25 years ago, Thakur said no proposal has been received from the RBI in this regard.
The DICGC provides an insurance coverage of up to Rs 1 lakh to a depositor of a bank. He further said the DICGC Act, 1961, provides that the Corporation may, from time to time, having regard to its financial position and to the interest of the banking system, raise, with the previous approval of the government, the financial limit of the total amount payable to one depositor in respect of his deposit at all the branches of a bank taken together.
The RBI had constituted a committee under the chairmanship of M Damodaran to look into banking services rendered to retail and small customers, including pensioners, and also to look into the system of grievance redressal mechanism prevalent in banks, its structure and efficacy and suggest measures for expeditious resolution of complaints.
The panel had, inter-alia, recommended that the deposit insurance cover provided by DICGC should be raised to Rs 5 lakhs so as to encourage individuals to keep all their deposits in a bank convenient for them.
Earlier, Finance Minister Nirmala Sitharaman had said the government would soon bring in a legislation on raising the insurance cover on bank deposits.
Besides several leaders of urban cooperative banks, Sahakar Bharati leaders have met Finance Minister Nirmala Sitharaman pitching for an increase in deposit insurance limits.
Sahakar Bharati had demanded a separate Deposit Insurance Limit for Institutional Depositors, Special Provision in the DICGC Act, 1961 to protect the interests of Depositors of fraud affected banks eg PMC Bank Ltd, Pen Urban Co-op Bank Ltd, etc.
Sahakar Bharati has demanded that the Deposit Insurance Limit for individual be raised to Rs 5,00,000/- and that of institutional investors to Rs 25,00,000/. To protect the interests of depositors of such Banks that fail on account of frauds the DICGC Ltd should create a separate Reserve, Sahakar Bharati leaders have demanded.