Unity Small Finance Bank pays Rs 3,800 cr to 850,000 PMC Bank depositors

The beleaguered Punjab and Maharashtra Cooperative Bank (PMC) Bank depositors have a reason to cheer ahead of Gudi Padva as Unity Small Finance Bank has paid Rs 3,791.55 crore to around 847,606 depositors after Deposit Insurance and Credit Guarantee Corporation (DICGC) settled the amount as per the list furnished by the bank.

According to the plan approved by the Union government, Unity Small Finance Bank was supposed to pay the insured deposit amount up to Rs 5 lakh received from the DICGC immediately. And, the bank will have 20 years to repay DICGC.

DICGC in a statement on Thursday said, “Pursuant to Government of India notification dated January 25, 2022 regarding the merger of PMC Bank with Unity Small Finance Bank with DICGC support, the main claim of the captioned bank for an amount of Rs 37,91,55,33,367.64 has been settled for 847,506 traceable depositors, as per the list furnished by the bank”.

Around 900,000 individual depositors of PMC Bank are owed an amount to the tune of Rs 7,836.77 crore as of September 30, 2020. For depositors who have deposits in excess of Rs 5 lakh in the bank, after the initial amount of Rs 5 lakh is paid, Rs 50,000 over and above the insured amount will be paid to them at the end of first year. Another Rs 50,000 will be paid out at the end of the second year. After three years, the bank will pay up an additional Rs 1 lakh to the depositors and after four years, the bank shall pay up to an additional Rs 2.5 lakh. After five years, the bank shall pay up to an additional Rs 5.5 lakh. And after 10 years, any amount pending after the payments detailed above, will be paid on demand from the depositors.

Unity SFB started its operations in November last year after receiving a final nod from the central bank. Unity SFB is 51:49 joint venture between the Centrum Group and Bharat Pe.