<p>In a quick implementation of a budget provision, the Deposit Insurance and Credit Guarantee Corporation (DICGC), which protects depositors if a bank fails, Tuesday raised the limit of insurance cover per depositor from Rs 1 lakh to Rs 5 lakh with immediate effect.</p>.<p>The Reserve Bank of India, which governs DICGC, said in a note that the rule will be effective from Tuesday itself.</p>.<p>The relief to depositors was announced in the union budget presented by Finance Minister Nirmala Sitharaman on Saturday.</p>.<p>The corporation covers all individual bank deposits -- savings, fixed, current and recurring -- at all commercial and co-operative banks. The primary cooperative societies, however, are not insured by the DICGC.</p>.<p>With the latest change, the insurance limit for each depositor in a bank, will be capped at Rs 5 lakh, including both principal and interest amounts.</p>.<p>In case a bank goes into liquidation, depositors would get the insurance money as per their deposits for a maximum of up to Rs 5 lakh.</p>.<p>The demand for the change in limits to Rs 5 lakh became stronger after the collapse of Punjab Mumbai Co-operative Bank last year.</p>
<p>In a quick implementation of a budget provision, the Deposit Insurance and Credit Guarantee Corporation (DICGC), which protects depositors if a bank fails, Tuesday raised the limit of insurance cover per depositor from Rs 1 lakh to Rs 5 lakh with immediate effect.</p>.<p>The Reserve Bank of India, which governs DICGC, said in a note that the rule will be effective from Tuesday itself.</p>.<p>The relief to depositors was announced in the union budget presented by Finance Minister Nirmala Sitharaman on Saturday.</p>.<p>The corporation covers all individual bank deposits -- savings, fixed, current and recurring -- at all commercial and co-operative banks. The primary cooperative societies, however, are not insured by the DICGC.</p>.<p>With the latest change, the insurance limit for each depositor in a bank, will be capped at Rs 5 lakh, including both principal and interest amounts.</p>.<p>In case a bank goes into liquidation, depositors would get the insurance money as per their deposits for a maximum of up to Rs 5 lakh.</p>.<p>The demand for the change in limits to Rs 5 lakh became stronger after the collapse of Punjab Mumbai Co-operative Bank last year.</p>
