DICGC mops up Rs. 9,561 cr premium in first halt of fiscal

The Deposit Insurance and Credit Guarantee Corporation (DICGC), which provides insurance cover to depositors of banks, has collected deposit insurance premium of Rs 9,561 crore from banks during the six months ended September 2021, of which 93.5 per cent was contributed by commercial banks and the rest by co-operative banks.

With this, the Deposit Insurance Fund (DIF), built out of the premia paid by insured banks and coupon income received on investments in government securities, swelled to Rs 1.41 lakh crore as of September 2021, yielding a reserve ratio (ratio of DIF to insured deposits) of 1.81 per cent, up from Rs 1.29 lakh crore in March 2021, the RBI said in the Financial Stability Report (FSR).

The settlement and recovery of claims from banks in the first half of 2021-22 was significantly higher than a year ago, the central bank said. As on December 20, 2021, DICGC has paid Rs 1,374 crore in respect of 1.09 lakh depositors of 16 out of 21 troubled banks – including PMC Bank – that were eligible to receive such pay-outs, it said.

DICGC, headed by RBI Deputy Governor Michael Patra, pays out a maximum of Rs 5 lakh as insurance to the depositor of a troubled bank irrespective of the total amount that the customer has deposited in the bank. It paid Rs 393 crore to depositors in the first six months of the half-year ended September 2021, a rise of 1,334 per cent when compared to Rs 27.4 crore in the same period of last year.