Deposit Insurance
RBI's central board approves risk-based deposit insurance framework for banks
This story was originally published at 17:14 IST on 19 December 2025
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--RBI: Central Board of Directors Fri met in Hyderabad
--RBI: Central Board discussed global, domestic econ situation, challenges
--RBI: Central Board approved risk-based deposit insurance framework for bks
--RBI: Central Board reviewed draft FY25 Trend and Progress of Banking report
NEW DELHI – The Reserve Bank of India's Central Board of Directors Friday approved the risk-based deposit insurance framework for banks, it said in a release. The central board also discussed global and domestic economic situation and associated challenges, the RBI said.
The RBI had in October proposed introducing a risk-based premium framework for deposit insurance, aimed to help financially sound banks to save significantly on the premium paid. The new framework was proposed to be effective from the 2026-27 (Apr-Mar).
Deposit Insurance and Credit Guarantee Corp. has been operating the deposit insurance scheme since 1962 on a flat rate premium basis. Currently, banks pay a flat rate premium of 12 paise per INR 100 of assessable deposits. While the existing system is simple to understand and administer, it does not differentiate between banks based on their soundness, the RBI had said.
The board, which met in Hyderabad, also reviewed the activities of select central office departments and the draft Report on Trend and Progress of Banking in India for FY25. End
Reported by Shubham Rana
Edited by Vandana Hingorani
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