The Deposit Insurance and Credit Guarantee Corporation (DICGC) has settled deposit insurance claims amounting to Rs 549.27 crore for three cooperative banks in Kerala during the past five years, the Union Government informed the Lok Sabha.
In a written reply, Minister of State for Finance Shri Pankaj Chaudhary said that DICGC administers the deposit insurance scheme under the DICGC Act, 1961, which provides insurance coverage of up to Rs 5 lakh per depositor, including principal and interest. The insurance cover currently extends to all RBI-licensed cooperative banks operating in Kerala.
The Minister clarified that cooperative banks in the State, including the Kerala State Cooperative Bank and 58 Urban Cooperative Banks (UCBs), operate under the regulatory framework of the Reserve Bank of India (RBI) and are required to comply with its guidelines.
Highlighting depositor protection measures, the government said that RBI and NABARD have implemented several initiatives to enhance transparency, accountability, and financial stability in cooperative banks.
These include the Prompt Corrective Action (PCA) framework for UCBs, mandatory Boards of Management for professional oversight, whistle-blower mechanisms, risk-based internal audit systems, and NABARD’s Fraud Vulnerability Index (VINFRA).
