DICGC to process claims of depositors of 21 UCBs

Mumbai: The Deposit Insurance and Credit Guarantee Corporation (DICGC) will be processing the claims of depositors of the 21 urban co-operative banks (UCBs) that are currently under the Reserve Bank of India's (RBI) All Inclusive Directions (AID).The 21 UCBs include 11 from Maharashtra, five from Karnataka, one each from Kerala, Punjab, Uttar Pradesh, Rajasthan and Madhya Pradesh.

In this context, DICGC has asked depositors of all the 21 urban co-operative banks to contact their banks and submit the declaration of willingness to enable DICGC to make payments and also update any other documents/ information, including KYC, if needed by the bank. This is to ensure that depositors' claims can be included in the list being prepared by UCBs for submission to DICGC by October 15.

With the DICGC (Amendment) Act, 2021, which came into force with effect from September 1, the Corporation will pay the depositors of the insured banks placed under AID (with restrictions on withdrawal of deposits), an amount equivalent to the deposits outstanding (up to a maximum of Rs 5 lakh) within a period not exceeding 90 days. For starters, AID is equivalent to PCA in terms of PSBs, the only difference being that the depositors can withdraw money in the case of the latter, whereas it is not possible in case of UCBs. 'Necessary instructions have been issued to these banks to submit the claims within 45 days after obtaining the willingness of depositors to claim deposit insurance,' a DICGC statement said.

The verification and settlement of the claims on submission by the banks in the aforesaid list should be done within the next 45 days by DICGC (November 29). "These banks shall submit a claim list by October 15, and update the position as on November 29, 2021 (with principal and interest), in a final updated (second) list, to enable DICGC to settle the claim and discharge its insurance liability in full as per norms," it added.Unpaid (updated willingness list)/difference in amount of deposits up to eligible amount (as per final updated list submitted by November 29, 2021) will be paid within 30 days of receipt (that is by December 29).