1. 'Under the provisions of Section 16 (1) of the DICGC Act, 1961, if a bank fails/gets liquidated, the DICGC is liable to pay to each depositor through the liquidator, the amount of his deposit up.
2. Deposit Insurance and Credit Guarantee Corporation (DICGC) is a wholly owned subsidiary of Reserve Bank of India. It was established on 15 July 1978 under the Deposit Insurance and Credit Guarantee Corporation Act, 1961 for the purpose of providing insurance of deposits and guaranteeing of credit facilities.

DICGC stands for Deposit Insurance and Credit Guarantee Corporation. The functions of the DICGC are governed by the provisions of The Deposit Insurance and Credit Guarantee Corporation Act, 1961 (DICGC Act) and The Deposit Insurance and Credit Guarantee Corporation General Regulations, 1961 framed by the RBI in exercise of the powers conferred by Section 50(3) of the said Act.

Deposit Insurance and Credit Guarantee Corporation DICGC Short Notes:

Hi friends this is a brief notes on DICGC and its operations in Banking. Most of you might think that knowing this kind of information doesn't give marks in written test. But as far as I believe this will definitely be a helping hand for your Group Discussion (GD) and in Interviews of SBI PO, IBPS PO Clerks or any other Bank or Insurance Exams. Lets see what this topic covers.
Generally in India, the bank deposits are covered under the insurance scheme provided by DICGC full form Deposit Insurance and Credit Guarantee Corporation. This is a wholly owned subsidiary of the Reserve Bank of India (RBI). This was established on July 15, 1978 under Deposit Insurance and Credit Guarantee Corporation Act, 1961. The head office is located at Mumbai. The idea behind the Deposit Insurance is to let the public have trust in the entire bank and its working system, and also provides protection against the loss of deposits up to a significant extent. The authorized capital of the Corporation is 50 crore (issued by Reserve Bank of India). The management of the Corporation vests with its Board of Directors and Deputy Governor of the RBI is the Chairman.
Bullet Points to remember:

• All commercial banks including branches of foreign banks functioning in India, local area banks and regional rural banks are insured by the DICGC.
• At present all co-operative banks other than those from the States of Meghalaya, and the Union Territories of Chandigarh, Lakshadweep and Dadra and Nagar Haveli are covered under the deposit insurance system of DICGC.
• Primary cooperative societies are not insured by the DICGC. The DICGC insures all deposits such as savings, fixed, current, recurring, etc. except the following types of deposits.
1. Deposits of foreign Governments.
2. Deposits of Central/State Governments.
3. Inter-bank deposits.
4. Deposits of the State Land Development Banks.
5. Any amount due on account of any deposit received outside India.
• Each depositor in a bank is insured upto a maximum of Rs. 1,00,000 (Rupees One Lakh) for both principal and interest amount held by him.
• The deposits kept in different branches of a bank are aggregated for the purpose of insurance cover and a maximum amount upto Rupees one lakh is paid.
• The DICGC insures principal and interest upto a maximum amount of Rs. One Lakh. Deposit insurance premium is borne entirely by the insured bank If you have deposits with more than one bank, deposit insurance coverage limit is applied separately to the deposits in each bank.
• The Corporation may cancel the registration of an insured bank if it fails to pay the premium for three consecutive half year periods.
• Registration of an insured bank stands cancelled if the bank is prohibited from receiving fresh deposits; or its licence is cancelled by the RESERVE BANK or it has transferred all its deposit liabilities to any other institution; or it is amalgamated with any other bank.

Above information was collected from below Sources:
www.dicgc.org.in
www.rbi.org.in
You can visit these for in-depth knowledge of above topic.

Dicgc Clause

Dicgc India

Dicc Ithaca Ny