Full Form of BDG

What is BDG?

Bank Deposit Guarantee (BDG) refers to the protection provided to depositors against the loss of their deposits held with a bank in the event of the bank's failure. In India, this guarantee is primarily administered by the Deposit Insurance and Credit Guarantee Corporation (DICGC), a subsidiary of the Reserve Bank of India. Under the BDG framework, each depositor is insured up to a maximum of ₹5 lakh per bank, covering both principal and interest amounts. This scheme was enhanced from the earlier limit of ₹1 lakh in 2020 to provide greater security to savers. The BDG is crucial for maintaining public confidence in the banking system, especially during financial crises or bank failures. It applies to all commercial banks, including public sector, private sector, foreign banks, and cooperative banks. The term is often used in banking examinations (such as IBPS, SBI PO, and RBI Grade B) to test candidates' knowledge of deposit insurance mechanisms. The guarantee does not cover deposits held with non-banking financial companies (NBFCs). Understanding BDG helps students and professionals appreciate the safety net available to Indian depositors and the role of regulatory bodies in ensuring financial stability.

BDG का फुल फॉर्म

Example

After the bank was liquidated, the DICGC invoked the BDG scheme and compensated all depositors up to the insured limit within the stipulated time.

BDG — frequently asked questions

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