Deposits in a bank in India are insured by the DICGC up to a maximum of:
- A.Rupees 1 lakh
- B.Rupees 2 lakh
- C.Rupees 5 lakh
- D.Rupees 10 lakh
Correct answer
Explanation
The correct answer is C, Rupees 5 lakh. The Deposit Insurance and Credit Guarantee Corporation is a wholly owned subsidiary of the Reserve Bank of India, and it insures the deposits held in banks. The cover was raised from one lakh rupees to five lakh rupees in 2020, and it applies for each depositor in each bank, taking the principal and the interest together. All commercial banks, including branches of foreign banks in India, local area banks, regional rural banks and cooperative banks, are covered, and the premium is paid by the bank, not by the depositor.
Option A, one lakh rupees, was the earlier limit and is the answer a candidate gives from an old book. Options B and D, two lakh and ten lakh rupees, are not limits under this scheme at all; two lakh rupees is instead the minimum amount for an RTGS transfer, which is why it appears here as a distractor.
Read the full article: Banking Terms and Abbreviations: Full Forms and Meanings
Practice Questions
View allIn banking, the full form of RTGS is
- A.Rapid Transfer Gross Scheme
- B.Rapid Transfer Gross Settlement
- C.Real Time Gross Settlement
- D.Real Time Gross Scheme
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RTGS is the system in which a transfer instruction is settled singly and immediately, rather than being held and netted off with others.
Read the full explanation →Which of the following is an instrument of monetary policy used by RBI? I. SLR II. MSS III. Corridor
- A.I and II
- B.II and III
- C.I, II and III
- D.I and III
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All three belong to the monetary policy toolkit of the Reserve Bank of India. SLR, the Statutory Liquidity Ratio, is the part of its deposits that a bank must keep with itself in cash, gold or approved securities, and raising or lowering it changes how much a bank can lend.
Read the full explanation →Which of the following is a qualitative tool used by RBI to control money supply?
- A.Bank Rate
- B.Moral Suasion
- C.Open Market Operations
- D.Cash Reserve Ratio
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The tools of the Reserve Bank are divided into quantitative tools, which change the total amount of credit in the system, and qualitative or selective tools, which change the direction in which that credit flows.
Read the full explanation →To improve internal control of banks, Reserve Bank of India has asked all banks to do what till 30 April 2018?
- A.To connect SWIFT with its Basic Banking Solution (CBS)
- B.To connect RTGS with their Core Banking Solution (CBS)
- C.To connect NEFT with its Basic Banking Solution (CBS)
- D.To connect MICR to their Basic Banking Solution (CBS)
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SWIFT is the international messaging network over which banks send payment and guarantee instructions across borders.
Read the full explanation →An IFSC code used for electronic funds transfer in India consists of how many characters?
- A.9
- B.11
- C.13
- D.16
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The Indian Financial System Code is an eleven character alphanumeric code that identifies a particular bank branch taking part in the electronic payment systems of the Reserve Bank of India.
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