Bank customers can access up to Rs 5 lakh within 90 days of moratorium, says Centre

The Union Cabinet on Wednesday approved amendments to the Deposit Insurance Credit Guarantee Corporation Act, under which account holders can access up to Rs 5 lakh within 90 days of a bank being placed under moratorium.

“The Deposit Insurance Credit Guarantee Corporation insures bank deposits such as savings, fixed deposits, current or recurring deposits,” Finance Minister Nirmala Sitharaman said at a press conference in New Delhi. “It also covers commercial, public, private sector banks and branches of foreign banks in India.”

The finance minister added that 98.3% of all bank accounts would be fully protected within the law. Last year, the central government had raised insurance cover on deposit to Rs 5 lakh from Rs 1 lakh to support account holders of stressed lenders like the Punjab and Maharashtra Co-operative Bank.

“Normally, it takes around eight to 10 years after complete liquidation to get money under insurance; but now, even if there is a moratorium, within 90 days, the process will definitely be completed, giving relief to depositors,” Sitharaman added, according to NDTV.

Meanwhile, Union minister Anurag Thakur said that Deposit Insurance Credit Guarantee Corporation was created for those facing problems once the Reserve Bank of India imposes moratoriums on…

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