(DICGC) Deposit Insurance and Credit Guarantee Corporation (Amendment Bill) passed in the Parliament session of august 2021, which ensured that any account holders of a bank on which the RBI had imposed a moratorium would get up to Rs 5 lakh of their deposits within 90 days.
Prime Minister Narendra Modi reaffirmed the same, stating that this was done while keeping the depositors in mind, and it would instill confidence in the account holders in the banking system itself.
The PM also added that over 1 lakh depositors had received Rs 1300 Crore of their money, which was stuck with banks under a moratorium imposed by the RBI within a few days after the enactment of the legislation mentioned above.
PM Modi has further assured that around 3 lakh additional account holders will be receiving their money stuck with such banks in the near future.
Keeping in mind, the claims filed by depositors of 16 moratorium imposed banks (DICGC) released a first installment of the depositors’ money.
The second installment will be released by the above agency on December 31st, 2021; PM Modi has said that this reform has made sure that the depositors’ money remains safe even when the bank has failed the system.
Earlier, only Rs 50,000 was deposited by account holders in the bank was guaranteed; later on, the amount was raised to Rs 1 lakh.
In the earlier period, no time for refund was announced, but the present government has made 90 days mandatory for refund in the event of a bank sinking.
Finance Minister Nirmala Sitharaman has stated that the interests of the depositors are on the priority list of the agenda in the Modi government. The minimum guaranteed amount was raised to Rs 5 lakh in case of the bank sank in the month of February 2020.
Even the Reserve of India has kept the theme of “Depositors First” as a guiding principle for all its policies as far all banks are concerned; RBI Governor Shaktikanta Das stated that their focus is on protecting the bank’s resilience, but RBI has kept the depositors’ interest on priority whether it is their supervision method or any scheme announced by Reserve Bank of India.