Thus, in very rate and unusual circumstances, when a bank faces a sudden and unforeseen liquidity problem, the Reserve Bank has, on an earlier occasion, at its discretion, extended liquidity support to the bank. 6  BIS Review 114/2006  A second such instrument is the provision of safety net in the form of deposit insurance (DI).
In India, DI is mandatory and covers all banks (commercial / cooperative / RRBs / LABs). All deposits except (a) deposits of foreign governments, (b) deposits of Central/State governments, (c) inter-bank deposits and (d) deposits held abroad are covered by DICGC.