Indian Bank Accounts - Are your deposits insured?

Selecting a bank in India - Is your money safe in Indian Banks?
28 failed Indian financial institutions from May 2006 to April 2007...

One of the first things that come to mind when choosing a bank in western countries today probably is customer service. However when choosing a bank in India the first question that one may ponder could be, HOW SAFE IS MY MONEY? Sales chart

Residents of the United States, Canada and European countries take bank deposit insurance for granted.

Banks going bankrupt and depositors loosing money in the west are not something that happens often. Banks in most developed countries have some kind of bank deposit insurance schemes where banks accounts are automatically insured.

In the rare case a bank suffers problems and cannot meet their obligations to repay their depositors. The account holders are paid from the deposit insurance up to the maximum limit of the deposit insurance per account. The amounts of coverage for deposit insurance varies according to banking laws of country where the banks are located in.

INSURANCE PROTECTION FOR YOUR BANK ACCOUNTS

In the United States bank accounts are covered by deposit insurance by the FDIC for up to $100,000 per account. Account holders do not have to pay for this protection.

Incase you are wondering if your bank account in the United States is protected by deposit insurance then you can check by using the link 'Is my USA bank covered by FDIC?'United States Currency

Canada also has protection for bank accounts and the Canadian Deposit Insurance Corporation(CDIC) insures bank accounts for $100,000.

Incase a bank goes bankrupt the account holders would be paid the full amount of their deposits up to a maximum of $100,000.

Canadian residents who have bank accounts and want to check if their banks are members of The Canada Deposit Insurance Corporation can check by using the link 'Is my bank account covered by deposit insurance'

European countries I believe also have some form of deposit insurance to protect their bank customers. The amount of insurance varies amongst different countries. Unless amounts have changed the last time I checked the minimum amount of coverage was approximately $26,000. The deposit insurance information for European countries can be viewed here.

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DO BANKS IN INDIA OFFER DEPOSIT INSURANCE PROTECTION?

Is your money safe in Indian Banks?

YES! India's banks also have consumer protection for  its banking customers. However the catch is that the maximum protection is, to the best of my knowledge, only Rupees one lakh. That works out to less than $2500 per account. Compare that with the $100,000 coverage provided by the US and Canadian banks.

The agency that provided deposit insurance for Indian banks is called The Deposit Insurance and Credit Guarantee Corporation (DICGC)

If you have a bank account in India and want to check if your Indian bank account is covered by the DICGC you can do so by using the links provided below:

√ For a list of Commercial Banks in India insured by DICGC 'Check Here'

√ For a list of Cooperative Banks in India insured by DIGCG 'Check Here'

List of financial institutions in India paid by depositors insurance

 Many financial institutions in India have run into trouble and their depositors have been paid by DICGC. A list of the names of these financial institutions and the amount paid by India's Deposit Insurance and Credit Guarantee Corporation for the period 2007 to 2008 (so far) is available here.

A list of Deposit Insurance and Credit Guarantee Corporation Claims Paid/Settled during 2008-09 (so far) is available here.

How careful can one be when selecting a bank in India. The best advice is look at reputation. Don't rush to open accounts with banks that offer interest on your deposits that appear to be highly inflated than market rates. India has several excellent financially sound banks that can definitely be considered as world class banks.

Banking sector now has so many excellent choices and services offered by Indian banks have improved so much because of competition. Whether its online banking, debit cards or ATM's Indian banks offer their customers just about every banking service.  

Readers who wish to share their comments are invited to email us at vkc@nriinformation.com Next PagePrevious Page

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