DICGC, the Deposit Insurance and Credit Guarantee Corporation, insures bank deposits in India up to ₹5,00,000 per depositor per bank, counting principal and interest together. Its cover extends to all state, central and primary co-operative banks, the category that includes urban co-operative banks and district central co-operative banks, and explicitly includes recurring deposits.
For anyone with a pigmy deposit, DICGC cover is the single most consequential fact to establish about the account, because it does not apply everywhere the product is sold. DICGC states, in its own words, that "Primary cooperative societies are not insured by the DICGC." That means a patpedhi, a credit co-operative society, a Souharda co-operative and a Nidhi company, all common providers of daily-deposit schemes, sit outside DICGC cover entirely, even though their passbooks and collection routine look identical to a bank's.
Cover and payment are different things. Where a bank is placed under All Inclusive Directions — the state usually written as being under directions, which leaves the licence intact — and those directions restrict withdrawals, DICGC's own timetable runs to 90 days: the bank files the depositor list within 45 days, DICGC verifies within 30 and pays within 15, and the depositor must first submit a signed willingness form with attested documents. In a winding-up, payment runs through the liquidator instead. What that process asks of a depositor is worth knowing before it is needed, and is my deposit protected sets out the eligibility test and the checks to make before depositing.
Two pigmy accounts opened the same way, with the same paperwork and the same daily visit from an agent, can therefore differ completely on this point. One held at a licensed co-operative bank is insured up to ₹5,00,000. The same product at a society is not insured at all. Establishing whether your institution is a bank or a society, by asking for its banking licence, not just its signboard, is the first and most useful question a pigmy depositor can ask, and it is one this site returns to across every guide on the subject.