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Module Units
- 1. Banking
- 2. Deposit Accounts
- 3. Loan Accounts
- 4. Mistakes To Avoid While Opening A Bank Account
- 5. Selecting A Suitable Savings Bank Account
- 6. Fund-based And Non-Fund based Financial Services Offered By Banks
- 7. Fixed Deposits
- 8. Recurring Deposit
- 9. Different Types Of Fixed Deposits In India
- 10. Deposit Insurance System
- 11. Circumstances Leading To Closure of Bank Accounts
- 12. Banking Transaction
- 13. Branch Banking And Online Banking
- 14. Transactions Available Through Online Banking
- 15. How To Start Online Banking
- 16. ATM Transactions
- 17. Different Types of Money Remittance Services Offered By Banks
- 18. Cheque Truncation System (CTS)
- 19. Keeping A Bank Account Secure
- 20. Safety Rules And Guidelines
- 21. Fictitious Emails, SMS And Phone Calls
- 22. Forged Notes
- 23. Ponzi Schemes
- 24. Borrowing Money
- 25. Types of Bank Loans
- 26. Credit Cards
- 27. How to use a credit card?
- 28. Importance Of Maintaining A Good CIBIL Score
- 29. Problem Of Excess Debt
- 30. Strategies To Avoid Excess Debt
- 31. Managing Money
- 32. Nomination Facility In Bank Accounts
- 33. Procedure For Making A Claim
- 34. Digital Money
- 35. Forms Of Digital Money
- 36. Debit Cards
- 37. Digital Payments
- 38. E-Wallets
- 39. Types of e-wallets
- 40. Unified Payments Interface
- 41. Benefits Of UPI System
- 42. Conclusion
Deposit Insurance System
Having read all the above information, a very logical and common question that came to Satish’s mind is what will happen to his money if the bank becomes bankrupt. Upon exploring the internet, he learned about the 'Deposit Insurance System' and was relieved to learn more about it.
A Deposit Insurance System is a system established by the Government to protect customers against the loss of the money deposited with a financial institution in case the latter becomes insolvent. This is done through RBI’s subsidiary Deposit Insurance and Credit Guarantee Corporation (DICGC) of India which ensures deposits of all banks including fixed deposits, current and savings accounts up to a limit of ₹500,000 for each depositor. The insurance cost is borne by the respective banks.
In case a bank covered by the Deposit Insurance Scheme of DICGC fails or is merged with another bank or undergoes liquidation, the DICGC pays the amount due to depositors. At present, the DICGC covers all commercial and cooperative banks of India, except a few.
However, the maximum insured amount per depositor is ₹ 5 Lakhs including principal and interest. Therefore, if a person has deposited ₹492,000 and the interest amount due to him is ₹10,000, the depositor will get only ₹500,000 back and will not get the additional ₹2000 due to him. In case a person has different accounts in different branches of the same bank, then all the accounts are consolidated and a total of ₹500,000 is paid to the person.
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