Safe deposits: Time to substantially increase insurance cover limit

Since policymakers are still in the process of increasing the limit, they would do well to take into account factors such as the rapid adoption of technology among customers

As reported by this newspaper on Monday, the Union government is considering increasing the limit for bank-deposit insurance from the current level of ₹5 lakh. Although the final decision has not yet been taken, the limit might be doubled to ₹10 lakh. Deposit insurance is provided by the Deposit Insurance and Credit Guarantee Corporation, which covers all forms of deposits in commercial and cooperative banks. The fact that the government is mulling over increasing the ceiling for deposit insurance must be welcomed. As things stand, although about 98 per cent of accounts in insured banks are covered, only about 43