Economics • Banking & FinanceEasy
What is the primary role of the 'Deposit Insurance and Credit Guarantee Corporation' (DICGC)?
A. To provide insurance protection to bank depositors up to a statutory limit per depositor per bank in case of bank failure✓ Correct Answer
B. To guarantee corporate bonds issued by infrastructure development companies
C. To insure export credit risks faced by Indian exporters in international trade
D. To provide disaster relief loans to commercial banks operating in flood-prone zones
💡 Solution & Explanation
The Deposit Insurance and Credit Guarantee Corporation operates as a statutory body under the Reserve Bank of India to provide deposit insurance protection up to five lakh rupees per depositor per insured bank. Incorrect choices incorrectly associate the corporation with corporate bond underwriting or export credit guarantees handled by specialized institutions. This insurance framework instills confidence among retail bank customers across the country.
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