Reserve Bank of India (RBI) Governor Sanjay Malhotra has announced India’s move towards international best practices that reward sound risk management. Nowhere is reform more urgent than in the Deposit Insurance and Credit Guarantee Corporation (DICGC), which has long overcharged well-operated commercial banks on premiums, amassing a surplus of Rs 2.1 lakh crore. This excess is unnecessary and inflates India’s cost of doing business. The RBI’s proposal to introduce risk-based deposit insurance must be implemented without delay.

The DICGC, a wholly-owned RBI subsidiary, insures deposits across banks. As of March, it covered 1,982 banks—139 commercial and 1,843 cooperative. In FY25, it collected Rs 26,764 crore in premiums and earned Rs 15,802 crore in investment income, generating a revenu

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