INSUBCONTINENT EXCLUSIVE:
Government owned banks have reported frauds of over Rs 95,700 crore in first 6 months of current fiscal.New Delhi: Depositors in failed and
liquidated banks will get only up to Rs 1 lakh as insurance cover, regardless of the amount in their accounts, according to the Deposit
Insurance and Credit Guarantee Corporation (DICGC), a wholly owned subsidiary of the Reserve Bank of India.This covers savings, fixed,
current and recurring accounts, the DICGC, which insures all bank deposits, said in response to a Right to Information (RTI) query filed by
PTI."Under the provisions of Section 16 (1) of the DICGC Act, 1961, if a bank fails/gets liquidated, the DICGC is liable to pay to each
depositor through the liquidator, the amount of his deposit up to Rs one lakh as insurance cover, for both principal and interest amount
held by him in the same right and same capacity at all the branches of a bank taken together," it said.Asked whether there is any proposal
or move under consideration to raise the limit of Rs 1 lakh insured in the bank in wake of the recent PMC Bank fraud, the DICGC said, "The
corporation does not have the requisite information."The corporation covers all commercial banks, including branches of foreign banks
functioning in India, local area banks and regional rural banks.All eligible cooperative banks as defined in Section 2(gg) of the DICGC Act
are also covered by the deposit insurance scheme."Each depositor in a bank is insured up to a maximum of Rs one lakh as on the date of
liquidation/cancellation of bank''s license or the date on which the scheme of amalgamation/merger/reconstruction comes into force," the
DICGC said.The response assumes significance with numerous instances of different banks becoming victim of frauds, putting at risk the
savings of people.On September 24, the RBI imposed operational curbs on Maharashtra-based PMC Bank and appointed an administrator following
the detection of alleged financial irregularities.According to the Mumbai Police''s Economic Offences Wing (EOW), the PMC Bank management,
allegedly in cahoots with a business family, concealed huge loan defaults by HDIL group firms from banking regulators.Over 70 per cent of
the bank's advances went to HDIL group, which led to a huge crisis when the realty group defaulted on repayment, the EOW said.Government
owned banks have reported frauds of over Rs 95,700 crore in the first six months of the current fiscal."According to Reserve Bank of India
(RBI), frauds as per year of reporting, as reported by Public Sector Banks (PSBs), during the period from April 1, 2019 to September 30,
