The Nigerian Deposit Insurance Corporation (NDIC), has stated assured Nigerians of its major mandate of protecting the funds deposited in banks by customers in the event of failure of banks, saying more Nigerians should cultivate the culture of saving money in banks to further boost economy.
NDIC added that bank customers’ safety net providers is also necessary and is being protected to engender confidence in the financial system and cushion bad effects of any failure on ordinary Nigerians, as against shareholders, who usually own banks and earn returns on their investment.
Speaking to corps members at the Keffi sensitization workshop last week Thursday, Kingsley Nwaigwe, deputy director in the research department of the NDIC, declared that it was more reasonable to protect the vulnerable savers than protecting a few.
He said, “We are here to inform and educate our enterprising youths in the need to imbibe banking culture, first and foremost. To tell you that even with the stipend your parents give you and what you are getting from your employer now, which is the Federal Government, you can still make savings.
“The NDIC has a mandate as a deposit insurer and liquidator of failed banks wherein we give between maximum of N500,000 to in each depositor of commercial banks and N200,000 to each depositor of micro-finance and primary mortgage banks in the event of their banks failure. It is pertinent to say that this coverage limit currently covers over nighty-five of bank depositors in the country.
He noted that depositors who have in excess of deposit insurance cover, would be paid their balance in form of liquidation dividends, upon the realization of a closed bank assets, adding that “interestingly, all the depositors of fifteen banks which failed in the past have been paid their full deposit.”
Nwaigwe identified slow judicial process, bureaucracy and ignorance of deposit insurance among Nigerians and even on the part of some bankers as some of the challenges of the ensuring deposit insurance system in Nigeria, just as he warned against the patronage of ‘wonder banks’ which promise more and deliver nothing.
According to him, “when a financial house masquerading as banks ask you to save money and get for instance, seventeen per cent, you should be weary and refuse to fall prey to fraudsters.”
He explained that the reviewed Decree 22 of 1988 which established the agency empowered it to protect depositors who patronize commercial banks, micro-finance banks, primary mortgage banks, merchant banks and the non-interest banks, licensed by the CBN as against illegal fund managers.
He charged the corps members to act as trainers to their host communities in their places of primary assignment on the importance of providing for future eventualities by patronising banks that are covered by NDIC’s safety nets.
RAZAQ AYINLA
