A recent press report said that more than 8 cooperative banks have failed in this fiscal resulting in credit insurance company DICGC paying a little over Rs. 143 crore to depositors.
Reports said that the eight cooperative banks include four are from Maharashtra, three from Karnataka and one from Gujarat. In the previous financial year, 26 cooperative banks had closed their operations.
As per the Under the norms of the Reserve Bank of India (RBI), with respect to Deposit Insurance and Credit Guarantee Corporation (DICGC), a wholly-owned subsidiary of a maximum of Rs 1 lakh is to be paid to a depositor in case a bank goes insolvent.
Reports said that the Reserve Bank’s credit insurance arm has paid over Rs 143.5 crore to depositors of eight cooperative banks which went bankrupt till July in 2011-12. The DICGC paid the maximum amount of Rs 48.7 crore to Ichalkaranji Cooperative Bank of Maharashtra and Samata Sahakari Bank depositors were paid Rs 38.83 crore.
The RBI has recently hiked key interest rates by 25 basis points, which is its 12th such hike since March, 2010. The hike has made auto, home and other loans more expensive.