INSURANCE COVERAGE ON BANK DEPOSITs
Dear Friends,
Govt. of India has enacted “Deposit Insurance and Credit Guarantee Corporation Act, 1961” to provide for the establishment of a Deposit Insurance and Credit Guarantee Corporation for the purpose of covering insurance of Bank deposits and guaranteeing repayment of Deposit amount in the unlikely event of any Bank unable to pay back the deposit to the Depositors.
Under this Act, the above Corporation was established by Reserve Bank of India with 100% Share capital, fully owned by them. However, RBI provides insurance coverage for Bank Deposits only for a Maximum amount of Rs.1,00,000/- (one lakh only). And there is no coverage for any deposits more than 1 lac. This maximum limit was fixed in the year 1993 and since then there is no revision.
Everyone will agree that one lakh bank deposit to-day means Nothing and generally people keep more than Rs.1 lakh as bank deposits to take care of unforeseen medical and other expenses. In case of senior citizens who depend on interest income only for their day-to-day living in the absence of pension or other income, it can be easily imagined than explained as to how much deposits they should maintain, when everything is becoming costlier day by day !
Since our country’s Banking industry is totally controlled by our RBI, and they exercise very effective monitoring system including periodical auditing of all banks, we have full faith in our Reserve Bank of India and hence feel our deposits are safe. However, we have slight apprehension and fear since maximum insurance coverage is only for 1 Lakh.
Our genuine apprehension and fear increases by looking at the NPA (Non Performing Assets) figures declared by various Nationalised Banks and also Private Banks in their financial reports (Balance Sheets). Like Price index, this is also ever on the increase. Further number of Banks in private sector also is going up. In addition, the fact that many States and also Central Govt. are competing with each other in waiving of Loans,
generously, to fulfil their pre-election promises, also adds to our anxiety. We as depositors in Banks genuinely feel very much concerned about the security of bank deposits without any insurance coverage.
We, therefore, appeal to Honourable Finance Minister and Governor Reserve Bank of India to increase Insurance coverage on all Bank Deposits without any maximum limit stipulation. In view of the fact that the above Corporation (DICGC) is charging Insurance premium from the Banks, and also RBI controls the Bank activities in the country, in all fairness, our appeal is justified fully and it should be approved at the earliest, without any extra expenditure to the Exchequer. However for any reason, if it is not possible to provide unlimited insurance cover, we request to increase the maximum limit to atleast Rs. 5 lakhs per bank branch immediately, so that we, depositors feel safe and secured about our deposits.
With Greetings and warm regards,
B.Namasivayam
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Dear Friends,
Govt. of India has enacted “Deposit Insurance and Credit Guarantee Corporation Act, 1961” to provide for the establishment of a Deposit Insurance and Credit Guarantee Corporation for the purpose of covering insurance of Bank deposits and guaranteeing repayment of Deposit amount in the unlikely event of any Bank unable to pay back the deposit to the Depositors.
Under this Act, the above Corporation was established by Reserve Bank of India with 100% Share capital, fully owned by them. However, RBI provides insurance coverage for Bank Deposits only for a Maximum amount of Rs.1,00,000/- (one lakh only). And there is no coverage for any deposits more than 1 lac. This maximum limit was fixed in the year 1993 and since then there is no revision.
Everyone will agree that one lakh bank deposit to-day means Nothing and generally people keep more than Rs.1 lakh as bank deposits to take care of unforeseen medical and other expenses. In case of senior citizens who depend on interest income only for their day-to-day living in the absence of pension or other income, it can be easily imagined than explained as to how much deposits they should maintain, when everything is becoming costlier day by day !
Since our country’s Banking industry is totally controlled by our RBI, and they exercise very effective monitoring system including periodical auditing of all banks, we have full faith in our Reserve Bank of India and hence feel our deposits are safe. However, we have slight apprehension and fear since maximum insurance coverage is only for 1 Lakh.
Our genuine apprehension and fear increases by looking at the NPA (Non Performing Assets) figures declared by various Nationalised Banks and also Private Banks in their financial reports (Balance Sheets). Like Price index, this is also ever on the increase. Further number of Banks in private sector also is going up. In addition, the fact that many States and also Central Govt. are competing with each other in waiving of Loans,
generously, to fulfil their pre-election promises, also adds to our anxiety. We as depositors in Banks genuinely feel very much concerned about the security of bank deposits without any insurance coverage.
We, therefore, appeal to Honourable Finance Minister and Governor Reserve Bank of India to increase Insurance coverage on all Bank Deposits without any maximum limit stipulation. In view of the fact that the above Corporation (DICGC) is charging Insurance premium from the Banks, and also RBI controls the Bank activities in the country, in all fairness, our appeal is justified fully and it should be approved at the earliest, without any extra expenditure to the Exchequer. However for any reason, if it is not possible to provide unlimited insurance cover, we request to increase the maximum limit to atleast Rs. 5 lakhs per bank branch immediately, so that we, depositors feel safe and secured about our deposits.
With Greetings and warm regards,
B.Namasivayam
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I support this campaign
ReplyDeleteI agree.But it should have substantially higher coverage than
ReplyDeleteRs. 5 Lakhs. Ideally it should cover the entire deposit amount.
S.Asokan
Thank you for your support. I request for your active participation in this campaign and I would appreciate your requesting your friends and relatives to support this issue as it will affect all particularly senior citizen whose bulk savings are in Bank FDs., if something happens to bank/s.
DeleteWith warm regards,
B.Namasivayam
Even 5 lakhs is nothing. Many people completely trust the nationalized banks. Many people's lifelong savings are with the banks. The entire sum must be safe.
DeleteDemand is justified. I supprt the issue. (y)
ReplyDeleteI support.
ReplyDelete