Economics • Banking & FinanceEasy
What is the primary role of the 'Deposit Insurance and Credit Guarantee Corporation (DICGC)' in India?
A. To guarantee corporate bonds issued by infrastructure companies against default
B. To provide deposit insurance to bank depositors up to a prescribed monetary limit per depositor per bank in the event of bank failure✓ Correct Answer
C. To provide direct credit guarantees to commercial banks for agricultural loans
D. To regulate non-banking financial companies engaged in public deposit mobilization
💡 Solution & Explanation
The Deposit Insurance and Credit Guarantee Corporation operates as a statutory subsidiary of the Reserve Bank of India, providing mandatory insurance cover for bank deposits up to a statutory ceiling per depositor per insured bank in the event of liquidation or amalgamation. Other choices concerning direct corporate bond guarantees or agricultural credit refer to distinct institutional mandates.
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