18.1 C
Delhi
Wednesday, February 12, 2025

Exempt PSBs, commercial banks from purview of DIS: AIBEA to Nirmala

Date:

Share post:

Donate-GC-Razorpay

Hyderabad: All India Bank Employees’ Association (AIBEA) on Friday appealed to Union Finance Minister Nirmala Sitharaman to exempt public sector banks and commercial banks from the purview of Deposit Insurance Scheme (DIS) in view of Section of 45 of Banking Regulations Act.

‘We learnt from the media reports that the RBI and Government are toying with the idea of further increasing the insurance cover for bank eposits under the Deposit Insurance Scheme’, AIBEA General Secretary Ch Venkatachalam pointed out in a letter to the Finance Minister.

He said for cooperative banks, the premium should be charged only on the deposit amount insured and not on the total assessable deposits of the bank.

Venkatachalam said ‘Year after year, public sector banks and all commercial banks are required to pay huge premium to Deposit Insurance and Credit Guarantee Corporation (DICGC) but the claim ratio is nil because there is no possibility of any bank being liquidated and forcing the situation of claiming the insured amount.’

Because of these reasons, as of March 31, 2024, the Deposit Insurance Fund of DICGC is Rs. 1,98,753 crores. The claims settled so far since 1962 are only Rs. 5,359 crores and that too for the co-operative banks, he said.

The AIBEA submitted to the government that the deposits of public sector banks and commercial banks which are covered by Section 45 of the Banking Regulations Act, be exempted from the coverage of DICGC cover.

Venkatachalam said out of 1997 banks covered by the DICGC, 1857 are co-operative banks. Only these banks are running the risk of facing problems of closure and liquidation and the seposits of these banks need to be covered by DICGC.

Even in the case of these banks, only to the extent of deposits covered by the insurance cover, premium should be charged and not on the total assessable Deposits which is much higher.

‘We are sure that the Government would keep the above submissions and make suitable announcement in the Union Budget on Saturday.’

Related articles

Ranveer Allahbadia’s ‘India’s Got Latent’ Comment: A Disturbing Sign of a Degenerate Thought Process

Ranveer Allahbadia, better known as BeerBiceps, has been at the center of controversy following his remarks on Samay...

PM Modi meets US VP JD Vance, his wife Usha

Paris/New Delhi: Prime Minister Narendra Modi met with US Vice President JD Vance and his Indian-origin wife Usha...

More than 1 crore take holydip in Sangam on Magh Purnima till 8 am

Prayagraj: More than one crore pilgrims, including saints, Kalpwasis, and devotees, took a holy dip in Sangam, the...

Egypt to unveil Gaza rebuilding plan without relocation

Cairo: Egypt plans to present a comprehensive Gaza reconstruction plan designed to ensure Palestinians remain on their land,...