Two years after PMC Bank crisis, troubled bank depositors are expected to reach 5 lakh by December

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  • Depositors at 21 troubled Indian banks can withdraw funds up to 5 lakh by December.
    In accordance with the instructions of the DICGC, banks will have to prepare a list of depositors willing to claim deposit insurance before November 29 and submit all claims to the authority within 45 days or before October 15.
  • The move will help troubled Indian bank depositors recover their funds under the government’s deposit insurance and credit guarantee program.

Depositors from 21 troubled Indian banks, including the besieged Punjab & Maharashtra Co-Op. Bank Ltd., can breathe a sigh of relief as the Deposit Insurance and Credit Guarantee Corporation (DICGC) has said it will be able to withdraw overdue funds up to 5 lakh by December.

“Accordingly, DICGC will pay depositors of insured banks (as listed) under AID (with restrictions on withdrawal of deposits) an amount equivalent to overdue deposits (up to a maximum of ₹ 5 lakh ) within a period not exceeding 90 days. Complaints will be settled in accordance with article 18A of the ibid law and the company’s complaints settlement procedure, ”he said in a press notification on Wednesday.

In accordance with the instructions of the DICGC, banks will have to prepare a list of depositors willing to claim deposit insurance before November 29 and submit all claims to the authority within 45 days or before October 15. “These banks must submit a list of claims by October 15, 2021 and update the position to November 29, 2021 (with principal and interest), in an updated final list (second) to allow the DICGC to settle the claim. claim and fully discharge its insurance liability in accordance with the standards, ”he said.

The move will help troubled Indian bank depositors recover their funds under the government’s deposit insurance and credit guarantee program. In September 2019, after the collapse of PMC Bank, the Reserve Bank of India imposed deposit withdrawal restrictions of up to 50,000 on the bank. Even though the limit was increased to ₹ 1 lakh in June of last year, many depositors who had larger amounts parked at the bank were unable to get their money back.

But that will change as PMC bank depositors, along with a few others, can now submit higher withdrawal requests. This decision will benefit the depositors of the following banks:

Bank State
Punjab and Maharashtra cooperative. Bank SA Maharashtra
Adoor Co-Operative Urban Bank Ltd Kerala
Bidar Mahila urban cooperative. Bank SA Karnataka
City Co-Operative Bank Ltd Maharashtra
Hindu cooperative. Bank Ltd, Pathankot Punjab
Kapol Co-Operative Bank Ltd. Maharashtra
Maratha Sahakari Bank Ltd., Bombay. Maharashtra
Millath Co-Operative Bank Ltd Karnataka
Needs of Life Co-Operative Bank Ltd. Maharashtra
Padmashree Dr Vithal Rao Vikhe Patil Maharashtra
People’s Cooperative Bank Ltd., Kanpur Uttar pradesh
Rupee Co-Operative Bank Ltd. Maharashtra
Shri Anand Coop. Bank Ltd., Pune Maharashtra
Sikar urban cooperative. Bank SA Rajasthan
Sri Gururaghvendra Sahakara Niyamitha Bank Karnataka
Mudhol Cooperative Bank Ltd Karnataka
Mantha Urban Cooperative Bank Ltd. Maharashtra
Sarjeraodada Naik Shirala Sahakari Bank Ltd. Maharashtra
Independence Cooperative Bank Ltd, Nashik Maharashtra
Deccan Urban Co-Operative Bank Ltd., Vijayapur Karnataka
Garha Co-Operative Bank Ltd., Guna Madhya Pradesh


“Depositors are advised to contact said banks and submit the declaration of will and also update any other document / information, if the bank needs it, so that their claims can be included by the bank in the list before October 15, 2021, ”the notification reads.

Last month, the government raised the limit on deposit withdrawals to ₹ 5 lakh from ₹ 1 lakh previously, by amending the DICGC law. The move allows depositors to withdraw funds up to ₹ 5 lakh within 90 days of a bank being placed under moratorium by the regulator.

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