Bank customers in India may have heard that deposits are insured up to ₹5 lakh. However, this does not mean that every savings account or fixed deposit receives a separate ₹5 lakh cover.
Deposit insurance is generally calculated per depositor, per insured bank, for deposits held in the same right and same capacity. Eligible balances in savings, current, fixed and recurring deposit accounts may be combined while calculating the insured amount.
This guide explains the DICGC deposit insurance limit, covered banks and deposits, joint-account rules, calculation examples and the process followed when an insured bank is placed under restrictions or liquidation.
Important: DICGC insurance is not an investment-return guarantee and does not provide compensation for every banking dispute, cyber fraud or unauthorised transaction.
What Is DICGC?
The Deposit Insurance and Credit Guarantee Corporation, commonly known as DICGC, is a wholly owned subsidiary of the Reserve Bank of India.
It forms part of India’s financial safety system and protects eligible depositors against certain losses arising from the failure of an insured bank or when an insured bank is placed under qualifying All-Inclusive Directions by the RBI.
DICGC operates under the Deposit Insurance and Credit Guarantee Corporation Act, 1961.
The current insurance limit is up to ₹5,00,000 per depositor per bank, subject to the applicable rules.
The ₹5 lakh limit has been effective since February 4, 2020.
What Does the ₹5 Lakh Deposit Insurance Limit Mean?
DICGC insures eligible principal and accrued interest together up to a maximum of ₹5 lakh.
The limit applies to deposits:
- Belonging to one depositor.
- Maintained with one insured bank.
- Held in the same right.
- Held in the same capacity.
If the combined eligible balance is below ₹5 lakh, the insurance may cover the eligible balance.
If the eligible balance exceeds ₹5 lakh, the maximum insurance cover is normally ₹5 lakh.
Insurance is determined using the applicable balance on the relevant cut-off date, subject to verification, set-off and other provisions of the DICGC Act.
Is the Limit ₹5 Lakh for Every Account?
No.
Opening several accounts with the same insured bank does not automatically create separate ₹5 lakh insurance limits.
For example, suppose one person has the following deposits in the same capacity with the same bank:
- Savings account: ₹1,50,000.
- Fixed deposit: ₹3,00,000.
- Recurring deposit: ₹80,000.
The combined deposits are ₹5,30,000.
The maximum DICGC insurance cover would generally be ₹5,00,000, not ₹5 lakh for each of the three accounts.
This aggregation applies even when the accounts are maintained at different branches of the same bank.
Are Principal and Interest Both Insured?
Yes. Eligible principal and accrued interest are included, but their combined insurance cannot exceed ₹5 lakh.
Example One
- Principal: ₹4,70,000.
- Accrued interest: ₹20,000.
- Total eligible amount: ₹4,90,000.
Subject to the applicable rules, the entire ₹4,90,000 may fall within the insurance limit.
Example Two
- Principal: ₹5,00,000.
- Accrued interest: ₹25,000.
- Total deposit: ₹5,25,000.
The maximum insurance cover would generally remain ₹5,00,000.
The interest is not excluded simply because it is interest. The portion above ₹5 lakh falls outside the maximum insurance limit.
Which Deposit Accounts Are Covered?
DICGC generally insures eligible deposits such as:
- Savings-bank deposits.
- Fixed deposits.
- Current-account deposits.
- Recurring deposits.
- Other eligible bank deposits.
The deposit must be maintained with a bank registered as an insured bank with DICGC.
The account should also satisfy the applicable ownership, cut-off-date and claim-verification requirements.
Which Banks Are Insured by DICGC?
According to the official DICGC guide, insured banks include eligible commercial and co-operative banks.
Commercial-bank coverage includes categories such as:
- Public-sector banks.
- Private-sector banks.
- Branches of foreign banks operating in India.
- Regional rural banks.
- Local area banks.
- Small finance banks.
- Payments banks.
Eligible co-operative banks are also covered under the deposit-insurance system.
However, a primary co-operative society should not automatically be treated as an insured co-operative bank. DICGC states that primary co-operative societies are not insured.
Customers should confirm the exact legal name and insurance status of the institution before making a large deposit.
The official DICGC List of Insured Banks can be used to check whether a bank appears in the current list.
Deposits and Investments Not Covered
DICGC’s official guide lists exclusions from deposit insurance.
These include:
- Deposits of foreign governments.
- Deposits of Central or State Governments.
- Inter-bank deposits.
- Deposits received outside India.
- Amounts specifically exempted by DICGC with the RBI’s prior approval.
The following products should also not be confused with insured bank deposits:
- Mutual funds.
- Shares.
- Bonds.
- Exchange-traded funds.
- Cryptocurrencies.
- Deposits accepted by non-banking financial companies.
- Certain deposits with institutions that are not registered insured banks.
An investment sold through a bank does not become DICGC-insured merely because it was purchased at a bank branch or through a banking application.
Deposits in Different Branches of the Same Bank
Deposits maintained at different branches of the same bank are combined when they belong to the same depositor in the same right and capacity.
Example
A customer has:
- ₹2,00,000 in a savings account at Branch A.
- ₹2,50,000 in a fixed deposit at Branch B.
- ₹1,00,000 in a recurring deposit at Branch C.
All three accounts are with the same bank and held in the customer’s individual capacity.
The combined deposit is ₹5,50,000. The maximum insurance cover would generally be ₹5 lakh.
Changing the branch does not create a new insurance limit.
Deposits in Different Banks
Deposits maintained with different insured banks are separately considered.
Example
A customer has:
- ₹4,00,000 with Bank A.
- ₹3,50,000 with Bank B.
If both institutions are separately registered insured banks, the insurance limit is applied separately to each bank.
Subject to the applicable conditions:
- Bank A deposit may be covered up to ₹4,00,000.
- Bank B deposit may be covered up to ₹3,50,000.
The deposits are not ordinarily combined merely because both banks fail or face restrictions at the same time.
Customers should confirm that the institutions are legally separate banks and are shown in DICGC’s current insured-bank list.
Meaning of Same Right and Same Capacity
The expressions “same right” and “same capacity” refer to the legal ownership or role in which a person holds the deposit.
Accounts held by one person in an individual capacity are normally aggregated within the same bank.
A person may also hold accounts in another legally recognised capacity, such as:
- Partner of a partnership firm.
- Guardian of a minor.
- Trustee of a trust.
- Director or authorised representative of a company.
- Joint account holder with another person.
Deposits held in genuinely different rights and capacities may be considered separately under DICGC rules.
However, merely using different account names or opening additional accounts does not necessarily create separate insurance cover. The bank and DICGC determine the admissible amount from account records and the legal capacity in which each account is maintained.
Sole-Proprietorship Accounts
DICGC clarifies that a deposit held in the name of a sole-proprietorship concern is aggregated with deposits held by the proprietor in an individual capacity.
Example
A sole proprietor has:
- Personal savings account: ₹3,00,000.
- Deposit in the proprietorship’s name: ₹3,00,000.
If both are with the same insured bank, the two balances should not be assumed to receive separate ₹5 lakh covers.
They may be aggregated because a sole proprietorship and its proprietor are not treated as separate ownership capacities for this purpose.
How Joint Accounts Are Treated
Joint-account coverage depends on the names of the holders and the order in which the names appear.
When the same people hold several joint accounts in the same order with one bank, the balances are generally aggregated.
Example: Same Names in the Same Order
Two accounts are held as:
- Arun and Beena.
- Arun and Beena.
The balances in these joint accounts may be combined when determining the applicable ₹5 lakh limit.
Example: Different Order
Two accounts are held as:
- Arun and Beena.
- Beena and Arun.
DICGC’s official FAQ explains that joint accounts with names appearing in a different order may be treated as being held in different rights and capacities.
Example: Different Group of Holders
Accounts are held as:
- Arun and Beena.
- Arun and Chitra.
Because the group of joint holders is different, the accounts may be considered separately under the applicable rules.
The final insurance calculation depends on the bank’s records and DICGC verification. Customers should not restructure accounts solely on the assumption that every joint-account variation guarantees a separate payout.
Does Adding a Nominee Increase Insurance Cover?
A nominee helps the bank identify the person authorised to receive the account proceeds after the depositor’s death, subject to succession and other applicable laws.
Adding a nominee should not be assumed to create another ₹5 lakh deposit-insurance limit.
Insurance is based primarily on the depositor, bank, account ownership and the right and capacity in which the deposits are held.
Customers should keep nomination details updated, especially for savings and fixed-deposit accounts.
Can the Bank Deduct Outstanding Loan Amounts?
Yes. DICGC explains that a bank may exercise its right to set off dues payable by a depositor as on the applicable cut-off date.
The deposit-insurance amount is calculated after eligible dues are netted, where such set-off applies.
Simplified Example
Suppose a depositor has:
- Eligible deposits: ₹5,00,000.
- Outstanding dues eligible for set-off: ₹80,000.
The admissible deposit amount may be calculated after the permitted adjustment.
The exact result depends on loan documents, account ownership, bank records and applicable law. Depositors should request an official calculation from the bank, administrator or liquidator.
Who Pays the Deposit-Insurance Premium?
The insured bank pays the deposit-insurance premium to DICGC.
Individual depositors do not normally pay a separate DICGC premium for their savings, current, recurring or fixed-deposit accounts.
A bank or agent should not ask a depositor to transfer money to a personal account to “activate” DICGC protection or release an insurance claim.
Such a request may be fraudulent and should be independently verified with the bank.
When Does DICGC Insurance Become Payable?
Deposit insurance is not paid simply because a customer is temporarily unable to use an account or has a complaint against the bank.
DICGC liability may arise in circumstances such as:
- Liquidation of an insured bank.
- Cancellation of the bank’s licence under the applicable conditions.
- An approved reconstruction, amalgamation or merger scheme.
- RBI All-Inclusive Directions that restrict deposit withdrawals and meet the statutory conditions.
The applicable event and cut-off date determine which balances and interest amounts are considered.
A routine failed transaction, account freeze, service complaint or cyber-fraud dispute does not automatically activate DICGC insurance.
What Are RBI All-Inclusive Directions?
The RBI may place a bank under All-Inclusive Directions, commonly called AID, and restrict certain banking activities, including withdrawal of deposits.
When an insured bank is placed under qualifying AID, Section 18A of the DICGC Act provides a time-bound process for eligible deposit-insurance claims.
The DICGC FAQ states that the bank must submit a depositor-wise list within 45 days from the date AID is imposed.
DICGC then has:
- Up to 30 days to verify the authenticity and genuineness of the claims submitted by the bank.
- Up to 15 further days to make payment after verification.
The total statutory process is designed not to exceed 90 days from the imposition of AID, subject to the bank submitting the required information and the other statutory conditions being satisfied.
This should not be interpreted as an unconditional promise that every depositor will receive money automatically on the 90th day.
What Should Depositors Do When a Bank Is Under AID?
According to DICGC, depositors should approach the bank’s Chief Executive Officer or administrator.
The depositor may be required to submit:
- A signed willingness form supplied by the bank.
- Attested copies of officially valid identity documents.
- Updated KYC information.
- Account and depositor details.
- Payment or alternate-bank-account information requested through the official process.
- Documents required for a nominee or legal-heir claim, when applicable.
The insured bank prepares and submits the depositor information to DICGC.
Depositors should respond promptly to official notices and keep copies of all forms and acknowledgements.
Is There a Deadline for the Willingness Form?
The DICGC FAQ states that a depositor can submit the willingness form while the bank continues to be under AID.
However, delaying the form can delay inclusion in the claim process.
Depositors should follow the bank’s official communication and submit the required documents as early as reasonably possible.
Do not submit identity documents through unofficial messaging links or to an unverified person claiming to be an agent.
Claim Process When a Bank Is Liquidated
In a liquidation case, DICGC does not normally ask every depositor to submit an independent claim directly to the Corporation.
The general process is:
- A liquidator is appointed for the bank.
- The liquidator prepares a depositor-wise claim list.
- Deposits in the same right and capacity are combined.
- Eligible loans or dues may be set off.
- The claim list is submitted to DICGC.
- DICGC scrutinises the list and calculates the admissible amount.
- The amount is released through the applicable process.
- The liquidator disburses the approved amount to eligible depositors.
The speed of payment may depend on the quality of the bank’s records, claim-list submission, identity verification and the depositor’s response.
Claim Process During Amalgamation or Reconstruction
When an insured bank is reconstructed, amalgamated or merged under an approved scheme, the claim process differs from liquidation.
DICGC may pay the applicable amount to the transferee or concerned bank based on:
- The eligible deposit.
- The insurance limit in force.
- The amount made available under the reconstruction or amalgamation scheme.
- The depositor-wise claim information submitted by the bank.
Depositors should follow communications from the RBI, DICGC and the transferee bank.
Do not rely on rumours circulated through social media about withdrawal dates or payout amounts.
How to Check Whether a Bank Is DICGC Insured
Use the following steps:
- Open the official DICGC List of Insured Banks.
- Search using the bank’s complete legal name.
- Confirm that the result refers to the same institution.
- Check whether the bank appears in the de-registered-bank or AID sections when relevant.
- Ask the branch for confirmation if the legal name is unclear.
- Retain deposit receipts and account statements.
DICGC also requires insured banks to provide or display information about deposit-insurance protection.
Do not depend only on a DICGC logo shown on an advertisement. Confirm the bank through the official list.
How to Check a DICGC Claim Status
DICGC provides a claim-status facility for supported cases.
To check:
- Visit the official DICGC Claim Status page.
- Select or enter the requested bank information.
- Provide the required claim or depositor details.
- Complete the displayed verification.
- Review the available status.
The facility may not show a claim until the bank or liquidator has submitted and processed the required information.
Do not pay a third party for access to an official claim-status service.
Documents Depositors Should Keep Updated
Customers can reduce avoidable difficulties by keeping the following records updated:
- Full name.
- Residential address.
- Mobile number.
- Email address.
- PAN or other applicable KYC information.
- Nominee details.
- Joint-holder information.
- Fixed-deposit receipts.
- Recent account statements.
- Loan and overdraft records.
- Details of any change in name or legal status.
The name and ownership capacity shown across related accounts should be accurate.
After the death of a depositor, the nominee or legal heir should contact the bank or liquidator and follow the official claim procedure.
DICGC Insurance and Bank Fraud Are Different
Deposit insurance should not be confused with compensation for unauthorised electronic banking transactions.
DICGC does not automatically compensate customers for:
- UPI fraud.
- Phishing.
- OTP fraud.
- Card fraud.
- Account takeover.
- Incorrect fund transfer.
- Failed ATM withdrawal.
- Mis-selling of an investment.
- Loss in a mutual fund or share investment.
- Disputes over bank charges or loan interest.
Such cases must be reported through the bank’s complaint system and the applicable RBI or law-enforcement channel.
DICGC primarily deals with eligible deposits when a qualifying insured-bank event occurs.
Common Misunderstandings
Every Bank Account Is Insured for ₹5 Lakh
Incorrect. Accounts in the same bank and held in the same right and capacity are generally combined.
Every Branch Provides Separate Insurance
Incorrect. Deposits across branches of the same bank are aggregated.
₹5 Lakh Principal Plus Interest Is Covered
Incorrect. Principal and eligible accrued interest together are covered only up to the maximum limit.
Mutual Funds Sold by a Bank Are Insured
Incorrect. Mutual funds and similar investments are not insured bank deposits.
NBFC Fixed Deposits Receive DICGC Cover
Do not assume this. DICGC’s official guide states that deposits mobilised by NBFCs are not covered by its bank-deposit insurance.
The Customer Must Pay a Premium
Incorrect. The insured bank bears the deposit-insurance premium.
DICGC Pays Immediately After Every Bank Restriction
Incorrect. Payment requires a qualifying legal event, depositor information, verification and compliance with the statutory process.
Practical Deposit-Safety Tips
Deposit insurance is only one part of financial safety.
Customers should:
- Confirm that the institution is an insured bank.
- Check the bank’s complete legal name.
- Keep deposit and KYC records updated.
- Add and periodically review nomination details.
- Understand how balances in the same bank are aggregated.
- Avoid treating high-interest investments as insured deposits.
- Read premature-withdrawal and renewal terms before opening an FD.
- Never share passwords, PINs or OTPs.
- Verify claim communications through official bank or DICGC channels.
- Avoid agents promising priority DICGC payments.
- Review regulatory notices directly on RBI and DICGC websites.
Moving or splitting deposits is a personal financial decision involving convenience, interest rates, tax, liquidity and institutional risk. Obtain qualified professional advice when necessary.
Frequently Asked Questions
What is the current DICGC insurance limit?
The maximum is ₹5 lakh per depositor per insured bank for eligible principal and interest held in the same right and capacity.
Does every fixed deposit receive ₹5 lakh cover?
No. Fixed deposits and other eligible accounts in the same capacity with the same bank are combined.
Are deposits in two different banks insured separately?
Yes. The insurance limit is generally applied separately to each insured bank.
Are accounts at different branches treated separately?
No. Deposits at different branches of the same bank are aggregated when held in the same right and capacity.
Is fixed-deposit interest covered?
Eligible accrued interest is included, but principal and interest together cannot exceed the ₹5 lakh limit.
Are joint accounts covered?
Eligible joint accounts are covered. Accounts containing the same holders in the same order are generally aggregated. Different groups or orders may be considered separately under DICGC rules.
Are co-operative-bank deposits insured?
Eligible co-operative banks are covered. However, primary co-operative societies are not DICGC-insured banks. Check the institution’s exact name in the official list.
Are NBFC deposits insured by DICGC?
No. Deposits mobilised by an NBFC should not be treated as DICGC-insured bank deposits.
Does a depositor have to purchase DICGC insurance?
No. The insured bank pays the insurance premium.
Does the depositor apply directly to DICGC after liquidation?
Normally, the liquidator prepares and submits the depositor-wise claim list. Depositors must follow the liquidator’s instructions and provide the required documents.
Is the payout always completed within 90 days?
The 90-day statutory process relates to eligible insured banks placed under qualifying RBI All-Inclusive Directions. It remains subject to timely submission of depositor data, verification and the requirements of the DICGC Act.
Official References
- DICGC Official Website
- DICGC Guide to Deposit Insurance
- DICGC Frequently Asked Questions
- DICGC List of Insured Banks
- Banks Under All-Inclusive Directions
- DICGC Claim Status
- Reserve Bank of India
Last reviewed: August 30, 2026.
Disclaimer: DIGIT KERALA is an independent information website and is not affiliated with DICGC, the Reserve Bank of India, any bank or any government organisation. This article provides general educational information and does not constitute financial, investment or legal advice. Deposit eligibility, insurance calculation, claim amounts, timelines and procedures depend on the DICGC Act, bank records and official verification. Rules and website services may change. Always confirm current information through DICGC, RBI and the concerned bank.