Another reason for the public confidence comes from the way the RBI has acted in the past in dealing with a bank that is failing. Section 45 of the Banking Regulation Act 1949 empowers the RBI to “make a scheme of amalgamation of a bank with another bank if it’s in the depositors’ interest or in the interest of overall banking system." Hence, if a bank is in a bad shape and there is a risk of the depositors losing their money, the RBI has the power to merge this bank with another bank in the interest of the overall banking system.