In India, deposits are insured up to ₹1 lakh, while the comparable number for BRICS countries like Brazil and Russia stand at ₹42 lakh and ₹12 lakh, respectively.
"Data on Cross Country Deposit insurance Coverage limit shows that deposit insurance coverage in India is one of the lowest at ₹1 lakh / $1508 / 0.9 times India's per capital income, " an SBI Ecowrap report said.
According to the report, another diverging trend that appeared pertained to the number of accounts - over 60% of the total accounts are less than ₹1 lakh, while around 70% are less than ₹2 lakh, and 98.2% are less than ₹15 lakh.
"So clearly, it seems on paper that the number of small depositors are adequately covered in terms of insurance cover, but in terms of quantum of deposits, we observe that percentage of deposits less than ₹1 lakh is only 7.8% of the deposit base," the report said.
Besides, 20.4% of the deposits are contributed by customers having deposits of more than ₹15 lakh but less than ₹1 crore, with average deposits of ₹35 lakh.
Effectively, customers with balances between ₹15 lakh and ₹1 crore get protection only to the extent of 2.8% of their deposits, though the premium is paid on the entire value of deposits held by them, the report added.