Is your bank deposit protected?

Kenya Deposit Insurance Corporation, (KDIC), is a resolution authority for banks, whose mandate as a risk minimizer is to:

1. Offer prompt and timely resolution of failed banks
2. Provide incentives for sound risk management
3. Provide a deposit insurance scheme to member institutions

The Corporation manages the Deposit Insurance Fund aimed at facilitating the prompt resolution of troubled banks while promoting public confidence in the banking system. KDIC- the successor of the Deposit Protection Fund Board (DPFB), provides a robust and comprehensive deposit insurance scheme and an extra mandate of risk minimization to instil market discipline in risk management.

1. Deposit Insurance Scheme

To fulfil this mandate, KDIC operates a deposit insurance scheme for its member institutions (banks and microfinance banks). The scheme is funded through an annual payment of premiums by members to a pooled Deposit Insurance Fund (DIF) that is used to resolve a member institution in case of failure. In the event the member institution is placed in liquidation, the Fund is used to compensate depositors their protected funds of up to KES 500,000.

Currently, the scheme has fifty-three (53) members comprising thirty-eight (38) commercial banks, one (1) mortgage finance bank, and fourteen (14) micro-finance banks. The category of deposits covered under this scheme are listed below:

• Current Accounts
• Savings Accounts
• Fixed Deposit Accounts
• Foreign Currency Deposits
• Trust Accounts (Account which is declared and designated as a trust account and whose beneficiaries are declared at the point of opening of such bank account, and updated periodically)

2. How does Deposit Insurance contribute to the country’s financial stability?

The role of deposit insurance is to stabilize the financial system in the event of a bank failure, by assuring depositors that they will have immediate access to their insured funds, despite the circumstances, thereby reducing their incentive to cause a "run" on the bank. Further, it facilitates the orderly payment of claims to depositors and creditors. The existence of deposit insurance, therefore, provides depositors and creditors with clarity, assurance, and confidence in the banking system thereby promoting financial stability.

3. Public Awareness

To promote public confidence and foster financial stability in our banking system, KDIC has continued to partner with member institutions in sensitizing  depositors on the importance and benefits of the scheme. The Corporation issues Deposit protection certificates as well as customized stickers and posters as part of the wider campaign for member identification. As a depositor, you are encouraged to look out for the KDIC Certificate of Deposit Insurance and membership stickers whenever you visit your bank.

MEMBERSHIP TO DEPOSIT INSURANCE SCHEME

The Corporation provides a Deposit Insurance Scheme for members as provided for by law. The following are our members covered under this scheme for the Financial Year ending June 30, 2023.

For more details, including reimbursement procedures and other clarifications, visit our KDIC website www.kdic.go.ke, or contact us through any of the following options:

Physical Address        KDIC offices

                                     UAP Towers, 23rd Floor,

                                     Upper Hill Road

Website                       www.kdic.go.ke

Postal address             P.O. Box 45983, 00100, Nairobi

KDIC continues to promote public confidence by contributing to financial stability, assuring depositors of  immediate access to their insured funds should their bank fail.