ECONOMICS
ECONOMIC INSTITUTIONS
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
It insures banking customers’ accounts so that they don’t lose their money if the bank collapses.
|
|
|
It insures the building that houses the bank against loss and damages.
|
|
|
It insures the bank against theft.
|
|
|
It insures the bank against lawsuits.
|
Detailed explanation-1: -Each depositor in a bank is insured upto a maximum of ₹ 5, 00, 000 (Rupees Five Lakhs) for both principal and interest amount held by him in the same right and same capacity as on the date of liquidation/cancellation of bank’s licence or the date on which the scheme of amalgamation/merger/reconstruction comes into force.
Detailed explanation-2: -Deposit insurance is one of the significant benefits of having an account at an FDIC-insured bank-it’s how the FDIC protects your money in the unlikely event of a bank failure. The standard insurance amount is $250, 000 per depositor, per insured bank, for each account ownership category.
Detailed explanation-3: -As the “Insurer” of the bank’s deposits, the FDIC pays deposit insurance to the depositors up to the insurance limit.
Detailed explanation-4: -The FDIC becomes the “receiver” and arranges a different, healthy bank to take over the failed bank’s deposits. The FDIC then transfers your money to another FDIC-insured bank, so you’ll have a new account in a different bank where your funds will be safe.
Detailed explanation-5: -The National Banking Act of 1933 created the Federal Deposit Insurance Corporation (FDIC), under the Federal Deposit Insurance Act, to provide insurance for all banks.