Bank deposits in India are generally seen as safe, but understanding the limits of deposit insurance is essential. The Deposit Insurance and Credit Guarantee Corporation (DICGC) provides coverage of ₹5 lakh (approximately $6,000 USD) per depositor per bank, which includes principal and interest across various account types such as savings, fixed, current, and recurring accounts. However, this insurance does not cover deposits from foreign governments, inter-bank deposits, or financial assets like mutual funds, shares, insurance policies, and cryptocurrencies. Each bank's deposits are insured separately, meaning that if a depositor has accounts in multiple banks, they can receive coverage of ₹5 lakh for each bank. In the event of a bank's liquidation, the DICGC pays the insurance amount to the liquidator, who is responsible for compensating the depositors. Therefore, it is crucial for individuals to be aware of their bank's insurance status and the limits of coverage, especially if their deposits exceed the insured threshold.