The Deposit Insurance and Credit Guarantee Corporation (Amendment) Act, 2021

It received Presidential Assent on 13^th August 2021. It amends the Deposit Insurance and Credit Guarantee Corporation Act 1961. It will provide the depositors time-bound access to their insured deposit amount, in case they are restricted from accessing their bank deposits.

• The funds have to be provided to the account holder within 90 days in the event of a bank coming under the moratorium imposed by the Reserve Bank of India (RBI).
• Within the first 45 days of the bank being put under moratorium, information would be collected by Deposit Insurance Credit Guarantee Corporation. In the next 45 days, it will review the information and repay depositors within a maximum of 90 days.
• The premium paid by banks for deposit insurance has been raised from 10 paise for every Rs 100 deposit, to Rs. 12 paise and a limit of 15 paise has been imposed.

The deposit insurance cover has been increased to Rs. 5 Lakh after the Budget 2020-21, which will cover 98.3% of depositors and 50.9% of deposit value in the banking system. It will cover all banks including regional rural banks and co-operative banks.