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From Jude Chinedu, Enugu
The Nigeria Deposit Insurance Corporation (NDIC) on Wednesday reassured bank customers that their deposits remain protected, while calling for greater public understanding of how the Deposit Insurance System (DIS) works, especially in the event of bank failures.
The assurance was given in Enugu at a stakeholders’ town hall meeting organised by the Corporation as part of efforts to deepen engagement, address misconceptions and strengthen public confidence in the Nigerian banking system.
Speaking at the forum, the Executive Director, Operations, NDIC, Dr Kabir S. Katata, said many Nigerians were still unclear about what the deposit insurance scheme covers, what happens when a bank’s licence is revoked and how depositors are reimbursed.
He said the town hall was designed to clarify such issues in practical terms and empower depositors with knowledge of how their funds are safeguarded.
“We recognise that misconceptions still exist regarding the scope, benefits and limitations of the Deposit Insurance System. Some members of the public are unsure about what is covered and what is not, what steps to take when a bank is closed and how depositors are reimbursed after the revocation of a bank’s licence.
This forum provides us the opportunity to clarify these issues and empower depositors and the general public with knowledge of how their funds are protected, how reimbursements are carried out and how the Corporation contributes to the stability of the financial system,” Katata said.
He stressed that NDIC’s slogan, “Protecting your bank deposits!” was not a mere phrase but a firm commitment to ensuring that depositors have access to their savings whenever a bank fails.
Katata explained that, in 2024, the Corporation increased the maximum deposit insurance coverage as part of efforts to strengthen depositor protection and promote financial inclusion.
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“Depositors of Deposit Money Banks, Mobile Money Operators and Non-Interest Banks are now insured up to N5 million, while depositors of Microfinance Banks, Primary Mortgage Banks and Payment Service Banks are covered up to N2 million. This expanded coverage protects about 99 per cent of depositors in Nigeria. It is a deliberate policy aimed at protecting small savers and enhancing trust in the banking sector,” he said.
He further disclosed that NDIC had improved its payout process, citing the prompt reimbursement of depositors of Heritage Bank, Union Homes and Aso Savings following the revocation of their licences.
According to him, the use of the Bank Verification Number (BVN) enabled the Corporation to trace depositors’ alternative accounts and transfer their insured funds within days.
“I urge all depositors to ensure that their BVN is properly linked to their bank accounts and identity records, as this greatly facilitates seamless and timely access to insured deposits in the event of bank failure,” he added.
Katata also emphasised the collaborative role of the NDIC and the Central Bank of Nigeria (CBN) in supervising banks to ensure sound governance and risk management practices.
He, however, noted that depositors also have a responsibility to remain vigilant and informed.
Also speaking, the Head, Communication and Public Affairs Department of NDIC, Hawwau Gambo, said recent developments in the banking sector, including licence revocations and ongoing recapitalisation efforts, had heightened public interest and, in some cases, confusion about the deposit insurance framework.
She explained that the town hall meetings were conceived following the Corporation’s Public Awareness Survey, which showed the need for more direct and interactive communication with stakeholders.
“Recent developments in the Nigerian banking sector have reinforced the need for sustained stakeholder engagement. While these actions are necessary for financial system stability, they have also heightened public interest and, in some instances, misconceptions about the Deposit Insurance System,” she said.
