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Every person deposits his hard earned money in the bank account so that he gets the benefit of interest and the money is also safe. But in recent times, there have been reports of the poor situation of many banks, which has increased the concern among the customers. Think, if the bank in which you have kept the money, then how much money can you get back? Let us understand the rules to the security of money deposited in bank accounts in easy language. Our experience and expertise will help give you the right information.

According to the previous rules, if a bank had become bankrupt, the customers used to get a maximum of Rs 1 lakh. But in the general budget of 2021, Finance Minister Nirmala Sitharaman announced a change in this rule. After amending the Deposit Insurance and Credit Guarantee Corporation Act (DICGC), the limit of the insured was increased from Rs 1 lakh to Rs 5 lakh.

After about 28 years, this change took place, which gave great relief to the customers. Actually, deposit insurance is a scheme that protects the amount of customers up to Rs 5 lakh when the bank fails. This information is based on our intensive study and reliable sources.

With this new rule, customers will no longer have to wait for the liquidation process of the bank. Even if a bank is in the Mooretorium, the deposit can still claim its amount under the DICGC Act. This means that this amendment will prove to be a boon for millions of people whose banks have been in crisis for a long time. This change is a reliable step taken in the interest of customers, which reflects the responsibility of the government.

Under Section 16 (1) of the DICGC Act, 1961, if a bank sinks, each depositor gets the sum insured up to Rs 5 lakh. If you have accounts in different branches of the same bank, the deposit and interest of all accounts will be added, but only up to Rs 5 lakh will be safe. This includes both principal and interest. That is, if your total deposit is more than this, then you will get only 5 lakh rupees. This rule is clean and transparent, which is necessary for every customer to understand.

It is very important to get the correct information before depositing money. DICGC gives a printed form to every registered bank, which has complete details of deposit insurance. If you want to understand something, you can interrogate the bank officer. We suggest that you do a thorough investigation before investing your hard earned money anywhere.

What will happen if you eat in two different banks? DICGC considers the deposit amount in each bank separately. That is, your 5-5 lakh rupees will be safe in both banks. But if there are many accounts in the same bank, then all will be added together and only up to 5 lakhs will be insured. This information will help strengthen your financial decisions.