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Consider the following statements.
1. Deposit Insurance and Credit Guarantee Corporation (DICGC) is a fully owned subsidiary of the Reserve Bank of India.
2. Depositors having less than Rs 5 lakh in their bank account have no legal recourse to recover funds in case a bank collapse.
Which of the above statements is/are incorrect?
- a)1 only
- b)2 only
- c)Both 1 and 2
- d)Neither 1 nor 2
Correct answer is option 'B'. Can you explain this answer?
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Most Upvoted Answer
Consider the following statements.1. Deposit Insurance and Credit Guar...
DICGC and Legal Recourse for Depositors
DICGC
Deposit Insurance and Credit Guarantee Corporation (DICGC) is a subsidiary of the Reserve Bank of India (RBI) that provides insurance cover to depositors in case of bank failure. It was established in 1978 under the Deposit Insurance and Credit Guarantee Corporation Act, 1961.
Legal Recourse for Depositors
Depositors having less than Rs 5 lakh in their bank account are insured by DICGC. In case of bank failure, they are entitled to receive an insurance cover of up to Rs 5 lakh per depositor, per bank. However, it is incorrect to say that they have no legal recourse to recover funds in case of bank collapse.
Correct Statement
The correct statement would be that depositors having less than Rs 5 lakh in their bank account have limited legal recourse to recover funds in case of bank collapse. They can approach the Debt Recovery Tribunal (DRT) or file a suit in a civil court to recover their dues. However, it is important to note that the process of recovering funds through legal channels can be time-consuming and may not guarantee a full recovery.
Conclusion
In conclusion, statement 1 is correct, and statement 2 is incorrect. Depositors having less than Rs 5 lakh in their bank account are insured by DICGC, and they have limited legal recourse to recover funds in case of bank collapse.
DICGC
Deposit Insurance and Credit Guarantee Corporation (DICGC) is a subsidiary of the Reserve Bank of India (RBI) that provides insurance cover to depositors in case of bank failure. It was established in 1978 under the Deposit Insurance and Credit Guarantee Corporation Act, 1961.
Legal Recourse for Depositors
Depositors having less than Rs 5 lakh in their bank account are insured by DICGC. In case of bank failure, they are entitled to receive an insurance cover of up to Rs 5 lakh per depositor, per bank. However, it is incorrect to say that they have no legal recourse to recover funds in case of bank collapse.
Correct Statement
The correct statement would be that depositors having less than Rs 5 lakh in their bank account have limited legal recourse to recover funds in case of bank collapse. They can approach the Debt Recovery Tribunal (DRT) or file a suit in a civil court to recover their dues. However, it is important to note that the process of recovering funds through legal channels can be time-consuming and may not guarantee a full recovery.
Conclusion
In conclusion, statement 1 is correct, and statement 2 is incorrect. Depositors having less than Rs 5 lakh in their bank account are insured by DICGC, and they have limited legal recourse to recover funds in case of bank collapse.
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Community Answer
Consider the following statements.1. Deposit Insurance and Credit Guar...
Currently, in an unlikely event of a bank failing in India, a depositor has a claim to a maximum of Rs 5 lakh per account as insurance cover. The cover of Rs 5 lakh per depositor is provided by the Deposit Insurance and Credit Guarantee Corporation (DICGC), which is a fully owned subsidiary of the Reserve Bank of India. Depositors having more than Rs 5 lakh in their account have no legal recourse to recover funds in case a bank collapses.
Deposits in public and private sector banks, local area banks, small finance banks, regional rural banks, cooperative banks, Indian branches of foreign banks and payments banks are all insured by the DICGC. The premium for this insurance is paid by banks to the DICGC, and not be passed on to depositors.
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Consider the following statements.1. Deposit Insurance and Credit Guarantee Corporation (DICGC) is a fully owned subsidiary of the Reserve Bank of India.2. Depositors having less than Rs 5 lakh in their bank account have no legal recourse to recover funds in case a bank collapse.Which of the above statements is/are incorrect?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer?
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Consider the following statements.1. Deposit Insurance and Credit Guarantee Corporation (DICGC) is a fully owned subsidiary of the Reserve Bank of India.2. Depositors having less than Rs 5 lakh in their bank account have no legal recourse to recover funds in case a bank collapse.Which of the above statements is/are incorrect?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer? for Current Affairs 2024 is part of Current Affairs preparation. The Question and answers have been prepared according to the Current Affairs exam syllabus. Information about Consider the following statements.1. Deposit Insurance and Credit Guarantee Corporation (DICGC) is a fully owned subsidiary of the Reserve Bank of India.2. Depositors having less than Rs 5 lakh in their bank account have no legal recourse to recover funds in case a bank collapse.Which of the above statements is/are incorrect?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for Current Affairs 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements.1. Deposit Insurance and Credit Guarantee Corporation (DICGC) is a fully owned subsidiary of the Reserve Bank of India.2. Depositors having less than Rs 5 lakh in their bank account have no legal recourse to recover funds in case a bank collapse.Which of the above statements is/are incorrect?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer?.
Consider the following statements.1. Deposit Insurance and Credit Guarantee Corporation (DICGC) is a fully owned subsidiary of the Reserve Bank of India.2. Depositors having less than Rs 5 lakh in their bank account have no legal recourse to recover funds in case a bank collapse.Which of the above statements is/are incorrect?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer? for Current Affairs 2024 is part of Current Affairs preparation. The Question and answers have been prepared according to the Current Affairs exam syllabus. Information about Consider the following statements.1. Deposit Insurance and Credit Guarantee Corporation (DICGC) is a fully owned subsidiary of the Reserve Bank of India.2. Depositors having less than Rs 5 lakh in their bank account have no legal recourse to recover funds in case a bank collapse.Which of the above statements is/are incorrect?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for Current Affairs 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements.1. Deposit Insurance and Credit Guarantee Corporation (DICGC) is a fully owned subsidiary of the Reserve Bank of India.2. Depositors having less than Rs 5 lakh in their bank account have no legal recourse to recover funds in case a bank collapse.Which of the above statements is/are incorrect?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer?.
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