What changed
The RBI has amended the presentation guidelines for Local Area Banks to add a specific disclosure requirement on DICGC insurance premium payments. Banks now have to confirm timely premium payment in the annual report, and explicitly note any outstanding amounts if payment was late. The change takes effect from 1 April 2026.
What it means for you
Banks will need to track premium payment dates more closely and ensure the information is reflected in the annual report. Non‑compliance will be visible to regulators and stakeholders, potentially affecting the bank’s credibility and supervisory assessment. Auditors will have an additional item to verify during the audit of financial statements.
What you must do
- Update the annual report template to include a DICGC premium payment disclosure section.
- Implement a process to verify that the premium is paid within the prescribed deadline each year.
- If payment is delayed, calculate the arrears and ensure they are disclosed in the report.
- Inform the audit team about the new disclosure requirement so they can test compliance.
Who it affects
Local Area Banks, Bank compliance officers, External auditors
What exact wording should be used for the premium disclosure?
State that the applicable deposit insurance premium was paid to DICGC within the prescribed timelines; if not, mention the amount of premium that remains unpaid.
Does this apply to previous financial years?
The requirement is mandatory for financial statements covering the period from 1 April 2026 onward. Earlier years are not subject to this new disclosure.
What are the consequences of not disclosing arrears?
Failure to disclose will be treated as a regulatory breach and may attract supervisory action or penalties under the Banking Regulation Act.