FRDI Bill: Bank deposits are safe, says PM to rumours

New Delhi: Prime Minister Narendra Modi on Wednesday sought to allay fears of bank account holders, saying their deposits were safe and the return on that will not be jeopardised. Addressing the FICCI annual general meeting, he said rumours were being spread by some sections about provisions of the proposed Financial Resolution and Deposit Insurance Bill under which the depositors would suffer.

“The government is trying to strengthen the banking system by policy initiatives on a daily basis. But rumours are rife on social media about the FRDI Bill. ‘’

The Prime Minister’s assurance comes as a huge controversy rages over the “bail-in” provision, under which banks will be allowed to forfeit a major portion of deposits made by account holders in case of a financial crisis. Opposition parties have alleged that the government could use people’s money to save financial institutions that have made bad lending calls.

Banks are struggling under a bad-loan burden of around Rs. 10 lakh crore ($150 billion).