India, March 22 -- justify;">As of March 2026, the Deposit Insurance and Credit Guarantee Corporation (DICGC), an RBI subsidiary, provides deposit insurance of up to Rs. 5 lakhs per depositor per bank. The bank that holds the deposit pays a flat premium of Rs. 0.12 per Rs. 100 of assessable deposits. With a flat premium rate, the current system treats banks that manage risk better the same as those that are weaker or riskier. However, this is set to change from 1st April 2026. The DICGC will implement the Risk Based Premium (RBP) framework, which will incentivise sound risk management by banks. In this article, we will understand the Risk Based Premium (RBP) framework and how banks can save on deposit insurance premiums under it.

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