RBI i.e. Reserve Bank of India has banned Mumbai based New India Co-operative Bank. The ban on New India Co-operative Bank means that from now on, customers will not be able to withdraw money or do transactions.
This ban on the bank has been implemented from last Thursday for the next 6 months. This ban has been imposed due to huge irregularities in the bank. At the same time, a line of worried customers was seen outside New India Co-operative Bank on Friday. New India Co-operative Bank is a private sector bank of the country, said Reserve Bank of India. Now customers are afraid that their hard earned money will be lost. In such a situation, the question is what should the customers do now.
Actually, this is not the first time that RBI has banned a bank. Reserve Bank of India has taken such action against many banks earlier also. Last year, Shirpur Merchants Cooperative Bank was banned. Earlier, strict restrictions were also imposed on PMC Bank and Yes Bank. Two years ago, similar restrictions were imposed on some cooperative banks in Uttar Pradesh and other states. Customers who have accounts and deposits in New India Co-operative Bank will not be able to withdraw money from their accounts. However, RBI has clarified that the ban will be lifted only after the condition of the bank improves. Now the question is, if a bank closes down, how much money do the customers get back? So let’s know everything today.
If a bank goes bankrupt, how much money will the customers get?
-If a bank collapses or its license is canceled by RBI, then the customers can get a maximum of Rs 5 lakh in their account.
- Deposits up to Rs 5 lakh are covered by insurance (DICGC).
- Only a total of Rs 5 lakh from the customer’s account, FD and savings account will be refunded.
- Even if your money is deposited in different branches of a bank, you will get a maximum of Rs 5 lakh only.
For example, if you have Rs 7 lakh deposited in a bank, 2 lakh in your account, 2 lakh in FD and 3 lakh in some other account and if that bank closes down, you will still get only Rs 5 lakh.
What to do to keep your money safe?
- Instead of keeping the entire amount in one bank, keep it in different banks.
- Deposit money in public sector banks (PSUs) and large private banks.
- Avoid keeping large amounts of money in co-operative banks as far as possible.
- Do not keep deposits of more than Rs 5 lakh in any one bank, as the insurance cover is limited to Rs 5 lakh.
If you have Rs 8 lakh and you have deposited it in two different banks (Rs 4 lakh in each), and if both the banks go bankrupt, you can still get back the entire Rs 8 lakh.
In which bank is it safer to keep money?
- Keep deposits in nationalised (PSU) banks – like SBI, Bank of Baroda, PNB etc.
- Keep it in big private banks – HDFC, ICICI, Kotak Mahindra etc.
- Avoid keeping large amounts of money in cooperative banks as far as possible.
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