The Deposit Insurance and Credit Guarantee Corporation (DICGC) has decided to pay the depositors of the insured ailing banks that come under All Inclusive Directions (AID), an amount equivalent to the deposits outstanding, up to ₹5 lakh.
The DICGC will complete the payment process within 90 days from the date of announcement.
According to a press release issued on Tuesday, September 21, the Reserve Bank of India subsidiary shall settle the claims as per Section 18A of the DICGC (Amendment) Act, 2021, as well as the Corporation’s procedure.
The DICGC said it has asked the troubled banks to obtain the willingness of the depositors to claim insured amount and submit the claims within 45 days.
“The verification and settlement of the claims on submission by the banks in the aforesaid list shall be done within the next 45 days by DICGC (November 29, 2021). These banks shall submit a claim list by October 15, 2021 and update the position as on November 29, 2021 (with principal and interest), in a final updated (second) list, to enable DICGC settle the claim and discharge its insurance liability in full as per norms,” the DICGC said in the release.
The body also asked the depositors to reach out to their respective banks and submit their declaration of willingness and update any pending documents before October 15 for their names to be included in the list.
The Corporation will then make the payment of the difference in amount of deposits up to the eligible amount of ₹5 lakh before December 29, as per the final updated list submitted by the banks.
The Parliament passed the Deposit Insurance and Credit Guarantee Corporation (Amendment) Bill, 2021 during the monsoon session and it was notified on August 27. The amendment was brought in after the RBI placed restrictions on Punjab and Maharashtra Cooperative (PMC) Bank last year. The DICGC has named 20 other stressed banks in the release.
