What is DICGC for FD

The Union Cabinet adopted an amendment to the Deposit Insurance and Credit Guarantee Corporation (DICGC) Act recently, allowing account holders to retrieve up to 5 lakh deposits within 90 days of a bank being placed under moratorium. This legislation was announced by Finance Minister Nirmala Sitharman at a news conference, and today it is in action.

Well, if you are not aware of the Act, it is big time you find the benefits of it. So let us first brush up on the basics of the Act, and the banks that are covered under this act.

Fixed Deposit

What is Deposit Insurance and Credit Guarantee Corporation?

The Reserve Bank of India’s Deposit Insurance and Credit Guarantee Corporation (DICGC) is a completely owned subsidiary of the Reserve Bank of India (RBI). It provides deposit insurance, which acts as a safety net for bank depositors in the event that the bank fails to pay its depositors.

The agency protects all types of bank deposit accounts, including savings, current, recurring, and fixed deposits, up to a ceiling of Rs. 5 lakh per account holder per bank. If an individual deposits more than Rs.5 lakh in a single bank, DICGC will pay just Rs.5 lakh, including principal and interest, if the bank fails.

How does DICGC Work?

Depositors’ money is protected by DICGC in all commercial and foreign banks in India; central, state, and urban co-operative banks; regional rural banks; and local banks, providing the bank has elected for DICGC coverage.

The functions of the agency are governed by the Deposit Insurance and Credit Guarantee Corporation Act, 1961, and the Deposit Insurance and Credit Guarantee Corporation General Regulations, 1961, which were drafted by the RBI under the terms of Section 50, sub-section (3). According to the laws, the establishment of this corporation is for the purpose of insuring deposits, guaranteeing credit facilities, and other similar matters.

The bill provides immediate relief to thousands of depositors and their money that is parked in stressed lenders and small cooperative banks. Here are the bank FDs that are listed from DICGC:

Banks with DICGC

Payment Banks

  • Airtel Payments Bank Limited
  • India Post Payments Bank Limited
  • Paytm Payments Bank Limited
  • Fino Payment Bank LTD
  • Jio Payments Bank Limited
  • NSDL Payments Bank Limited

Local Area Banks

  • Coastal Local Area Bank Ltd
  • Krishna Bhima Samruddhi Local Area Bank Ltd

Small Finance Banks

  • North East Small Finance Bank Ltd
  • Ujjivan Small Finance Bank Limited
  • Fincare Small Finance Bank
  • Jana Small Finance Bank
  • EASF Small Finance Bank
  • Suryoday Small Finance Bank Ltd
  • Capital Small Finance Bank Limited
  • AU Small Finance Bank Ltd
  • Equitas Small Finance Bank
  • Utkarsh Small Finance Bank Limited
  • Shivalik Small Finance Bank
  • Unity Small Finance Bank

Public Sector Banks

  • Bank of Baroda
  • Bank of India
  • Bank of Maharashtra
  • Canara Bank
  • Central Bank of India
  • Indian Bank
  • Indian Overseas Bank
  • Punjab and Sind Bank
  • Punjab National Bank
  • State Bank of India
  • UCO Bank
  • Union Bank of India

Private Sector Banks

Foreign Banks

State Co-operative Banks

District Central Co-op Banks

Urban Co-op Bank

So, when you opt for banks in these mentioned categories the DICGC for FD will apply. For example, when you choose Bank of Baroda then DICGC will apply for Bank of Baroda FD rates and returns.

What Applies Under this Act for Bank FDs

  • Depositors of a bank under moratorium will no longer have to wait to access their funds under the change. The Union Cabinet has determined that depositors will receive their money back in 90 days.
  • The first 45 days will be set aside for banks in crisis to be turned over to the insurance organization. It is said that the procedure will be completed without having to wait for a conclusion within 90 days.
  • All commercial banks, including branches of international banks operating in India, will be subject to this regulation, which will also apply to banks that are now subject to a moratorium.
  • The Finance Minister further said that the DICGC Act will cover 98.3% of all bank accounts of the bank, with above half the coverage in terms of the deposit value. Each depositor’s deposit in a bank is insured for a maximum of 5 lakh in principle and interest. With an increase in the insurance coverage from 1 lakh to 5 lakh, India will now cover 98.3% of all deposits accounts.
  • As a result, this clearance will provide relief to those institutions that have previously been placed under a moratorium. It is not retroactive, but if your bank has already declared a moratorium, this will cover the depositors of the bank with ease.

Deposits that DICGC Does not Cover

  • Deposits made by state or federal governments
  • Foreign government deposits
  • Deposits made by state land development banks with the state cooperative bank
  • Deposits made between banks
  • Funds owed to India and deposits received outside the country
  • Funds exempted by the corporation with prior RBI clearance


It is only when a bank registers with DICGC, the agency gets a printed certificate that displays the information in regards to the protection that is offered by the Act to depositors of the insured bank. If you are still confused about it, you should not hesitate to ask your Bank’s official about it, because obviously, a depositor wants to feel protected.

Lana Martinez is a freelance technical writer living in the Santa Clara. She's a gadget and tech geek who loves to write how-to articles about a wide range of topics. When she's not writing about technology, Lana loves watching and reading mysteries, cross stitching, and attending musical theatre. She's also an avid Doctor Who fan.