New Delhi: Extending a massive relief to depositors, Union Cabinet on Wednesday cleared amendments in Deposit Insurance and Credit Guarantee Corporation Act, 1961, (DICGC Act).
As per the changes, bank depositors will now get insurance of Rs 5 lakh on their deposits within 90 days of the moratorium.
It means that depositors of those banks under a moratorium will no longer have to wait for the Reserve Bank of India (RBI) to rescue them in order to access their funds.
With the recent amendment, depositors will get an insurance of Rs 5 lakh even if a bank is put under RBI's watch and its operations are suspended.
"Deposit Insurance Credit Guarantee Corporation was created in case people faced difficulties after RBI imposes moratoriums on banks. Today's Cabinet meeting has decided that within 90 days, depositors will receive Rs 5 lakhs of their money," Union Minister Anurag Thakur said while making the announcement.