The Nigeria Deposit Insurance Corporation (NDIC) has said more than 97. 6 per cent of account holders are fully covered by the N500,000 insurance limit.
According to the managing director and chief executive of the NDIC, Mr Bello Hassan disclosed at the opening ceremony of the 18th edition of the workshop for business editors and Finance Correspondents Association of Nigeria (FICAN), themed “Enduring Extreme Disruptions: Resilience & Reinvention for Banking System Stability & Deposit Insurance” in Gombe on Tuesday.
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Hassan said: “In 2016, 2017, 2018 and 2019, the total number of accounts in the deposit money banks stood at 83 million; 99.1m; 112m and 128.4m respectively.
“Out of these numbers, the N500,000 coverage limit fully covered 99.4%; 97.6%; 97.5% and 97.6% of accounts, respectively.
What these figures entail is that only less than three per cent of accounts/depositors are not fully covered by the prevailing coverage limits. The implication of this is that in the event of failure of a bank, above 97% of depositors would be fully covered by the Corporation.
“In addition, the coverage limits are not designed to be static but subject to periodic reviews to ensure that they are consistent with the public policy objectives of the Deposit Insurance System.
“The Corporation successfully reviewed upward the coverage limits from N50,000 at inception in 1989 to N200,000 in 2006 and N500,000 in 2010.”
The NDIC chief said the need to further educate depositors on the issue of coverage is paramount as the coverage limits have always been misunderstood by stakeholders.
“It is in that respect that we urge the media through this forum to make Nigerian depositors aware that the NDIC’s maximum coverage limits of N500,000 per depositor per commercial, merchant and, non-interest bank, primary mortgage bank and mobile money operator, as well as N200,000 per depositor per microfinance bank, remain the most adequate and robust in the world.”
Speaking on the amendments the corporation would pursue, he said: “There are a lot of areas that I think the NDIC act needs to be amended. We are liquidators and what happens is that at the point of liquidation, we try to recover the assets, especially the loans and advances that were granted by those banks that are in liquidation.”
