Banks under Directions: Govt, RBI working on allowing deposi

Banks under Directions: Govt, RBI working on allowing depositors withdraw up to ₹5 lakh


February 18, 2021
Deposit insurance may remain unused×
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At present, when a bank is placed under Directions, deposit withdrawals are capped and it ranges from ₹1,000 to ₹1 lakh of the total balance held by a depositor.
Depositors of Urban Co-operative Banks (UCBs), under Directions, may not have to sweat it out to get back their savings up to the ₹5 lakh insured amount, going by the amendments being considered to the Deposit Insurance and Credit Guarantee Act (DICGC), 1961.
The Government and the Reserve Bank of India (RBI) are believed to be examining the feasibility of allowing depositors of banks, especially UCBs, under regulatory Directions to withdraw up to the ₹5 lakh insured amount to alleviate their misery.

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