Is your money safe in a bank?
You keep a deposit in a private limited company or in a listed company. Let me name them – Orkay, or Thackersey Fabrics or IAEC, or you bought debentures of Vishwapriya Finance.
Well the company did badly. Ran out of money. OBVIOUSLY you lost money. You were wild. Sorry, no luck, your money is gone. Same problem – company’s sales was less than the salary bill – oh la la la…company closed down you were aghast, but poorer by the amount you invested.
So you kept money in Indian Overseas Bank, and Uco bank. Rs. 10,00,000 each…then another Rs. 25,00,000 – and you knew that Rs. 24L was falling due shortly. So you kept even more.
So you have about 28 L …
WHY WOULD YOU KEEP MONEY IN A BANK THAT NEVER MAKES MONEY?
You are risking too much for getting NOTHING……
Why Do People Still Have Deposits in Indian Overseas Bank and UCO Bank?
param
i think one of the main reasons is that DGCIC is an irrelevant scheme in indian context. though deposit insurance is clearly 1 lac, every single time RBI has made another bank take over failing banks, so in effect people are confident that any amount at bank is risk-free.
in contrast, usa has fdic with 250K$ limit, which is good enough that fed allows banks to fail as & when things turn sour.
maybe india should also increase the deposit insurance limit to something more realistic & then stick to it…