In a significant development, the Nigeria Deposit Insurance Corporation (NDIC) has announced a substantial increase in the maximum deposit insurance coverage levels for Deposit Money Banks (DMBs) from N500,000 to N5 million. The announcement was made by the Managing Director of NDIC, Bello Hassan, during a press conference held in Abuja on Thursday.
Effective immediately, this increase in coverage is aimed at providing greater protection to depositors and enhancing confidence in the banking sector. Hassan emphasized that the revised coverage would substantially expand the scope of depositors covered, providing full coverage to 98.98% of total depositors, compared to the current level of 89.20%.
Furthermore, the increase in coverage will significantly raise the value of deposits covered by deposit insurance to 25.37% of the total deposit value, up from the current cover of 6.31%. This move is expected to bolster depositor confidence and contribute to the overall stability of the financial system.
Hassan outlined the specific adjustments in coverage levels for different categories of financial institutions. For instance, the maximum deposit insurance coverage for Primary Mortgage Banks (PMBs) has been raised from N500,000 to N2,000,000. This adjustment will provide full coverage for 99.99% of total depositors and increase the value of deposits covered to 43.10% of the total deposit value.
Additionally, the NDIC has raised the maximum pass-through deposit insurance coverage for subscribers of Mobile Money Operators (MMOs) from N500,000 to N5,000,000 per subscriber. This measure aims to extend greater protection to subscribers of mobile money services, reflecting the evolving nature of financial transactions in the digital age.
The decision to increase the deposit insurance coverage underscores the NDIC’s commitment to safeguarding depositors’ funds and promoting financial stability.
