Deposits upto ₹5 lakh in troubled banks to be repaid in 90 days

Union Cabinet approves amendment to Deposit Insurance Credit Guarantee Corporation Bill 2021

Depositors in ailing banks like the PMC Bank may get some relief soon, with the Union Cabinet on July 28 clearing amendments to the country’s deposit insurance law to return upto ₹5 lakh of their savings within 90 days of the central bank’s imposition of a moratorium on a bank’s operations. “The Deposit Insurance Credit Guarantee Corporation Bill 2021 has been cleared by the Cabinet today,” Finance Minister Nirmala Sitharaman said in a briefing on July 28, adding that the Bill will be taken to Parliament in the ongoing session. “Accessing depositors money has been an issue of when it will be allowed and under what conditionalities. Normally, it takes about 8-10 years, after complete liquidation of the bank. Now, what we are saying is even if there’s a moratorium, this [90-day] measure will set in,” Ms. Sitharaman said.