Oyedele Declares Deposit Insurance Critical to Financial Stability Amid Rising Digital Risks

• Says misinformation currently poses significant threats to banking systems, adds public trust, crisis preparedness crucial

• Cardoso: bank recapitalisation has strengthened financial safety net; public awareness remains key stability

• Says stronger bank capital reduces failures, protects deposit insurance fund, others 

•NDIC boss urges coordinated crisis response as fintech reshapes Africa’s banking landscape 

•Warns confidence built over years can disappear in days if misinformation spreads

James Emejo and Deborah Adekoya in Abuja

Minister of Finance and Coordinating Minister for the Economy, Mr. Taiwo Oyedele, yesterday declared that deposit insurance was a strategic pillar for preserving public confidence and financial stability.

Oyedele warned that misinformation in the digital age now posed one of the biggest threats to the banking system.

He spoke at the opening of the 2026 International Association of Deposit Insurers (IADI) Africa Regional Committee (ARC) Annual Meeting and Workshop.

The forum, hosted by Nigeria Deposit Insurance Corporation (NDIC), in Abuja, had the theme, “Safeguarding Stability: Public Awareness and Crisis Readiness for a Stronger Future.”

Oyedele said while technological innovation, fintech, and cross-border financial integration presented enormous opportunities for financial inclusion and economic growth, they also exposed financial systems to new vulnerabilities that required stronger crisis preparedness.

He stressed that no economy could achieve sustainable growth without a stable financial system founded on public trust.

The minister said in an era where rumours and misinformation could spread across digital platforms within seconds, triggering liquidity pressures even in fundamentally sound institutions, public awareness had become a core risk management strategy rather than a public relations exercise.

He said depositors who understood that their savings were protected were less likely to panic during periods of uncertainty, adding that crisis preparedness must become an institutional culture rather than a reaction to emergencies.

According to him, effective crisis management requires seamless coordination among ministries of finance, central banks, deposit insurers, and regulatory agencies long before crises emerge.

Oyedele stressed, “Confidence cannot be legislated, purchased, or imposed. It must be earned – through strong institutions, transparency, effective communication, preparedness, and consistent action.

“The stronger our institutions, the greater the confidence they inspire; the greater the confidence, the more resilient our financial systems become; and the more resilient our financial systems, the stronger our economies and the greater the prosperity we can create for our people.

“I commend the International Association of Deposit Insurers, the Africa Regional Committee, and the Nigeria Deposit Insurance Corporation for convening this important dialogue.”

Highlighting Nigeria’s ongoing economic reforms under President Bola Tinubu, Oyedele pointed to the successful conclusion of the banking sector recapitalisation programme, under which 33 of the country’s 37 banks met the new capital requirements, raising about N4.65 trillion in fresh capital.

He said stronger bank balance sheets had significantly reinforced the country’s financial safety net by reducing the likelihood of bank failures and limiting potential exposure of the deposit insurance system.

Oyedele also cited Nigeria’s removal from the Financial Action Task Force (FATF) grey list in October 2025 as another milestone that had strengthened confidence in the country’s financial system.

He described deposit insurance as an important driver of financial inclusion, pointing out that increased public confidence encourages savings, expands lending, and ultimately supports investment, job creation and inclusive growth across Africa.

In his remarks, Governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, said safeguarding confidence had become the foremost responsibility of financial authorities as banking systems underwent rapid transformation driven by technology and digital finance.

Cardoso said the effectiveness of deposit insurance extended beyond sound legal frameworks to ensuring that the public clearly understood how those protections worked.

According to him, public awareness should no longer be viewed as a communication exercise, but as a strategic component of financial stability, particularly at a time when misinformation can spread rapidly through social media and digital platforms.

Represented by CBN’s Director, Other Financial Institutions Supervision Department (OFISD), Mr. Solaja Mohammed-Jamiu Olayemi, Cardoso also warned that perceptions amplified online could undermine confidence in financial institutions within a short time, making timely, accurate and credible communication indispensable.

The apex bank boss underscored the importance of crisis preparedness, saying recent episodes of financial stress across different jurisdictions demonstrate that institutions that invest in contingency planning, crisis simulation exercises, and operational resilience are better positioned to minimise disruptions.

He stressed that effective crisis management required close coordination among central banks, deposit insurers, supervisory authorities, and other regulators.

Cardoso added that the strength of any financial safety net depended not only on individual institutions but also on how effectively they worked together.

The central bank governor stated that innovation had transformed financial services, expanding inclusion, while simultaneously exposing institutions to cyber threats and other emerging risks.

He said regulators must, therefore, continuously strengthen operational resilience and update crisis management frameworks to remain effective in the evolving digital environment.

Cardoso highlighted CBN’s banking sector recapitalisation programme as one of its most significant reforms, saying the higher capital thresholds for banks are designed to ensure stronger institutions capable of absorbing shocks, supporting economic growth, and competing globally.

He explained that stronger capitalisation directly benefited deposit insurers by reducing institutional failures, limiting systemic claims, and minimising the conditions that often triggered bank runs.

Beyond recapitalisation, Cardoso said the apex bank had pursued wide-ranging reforms, including foreign exchange market unification, restoration of monetary policy discipline, stronger prudential standards, improved governance, and risk-based supervision to build a more resilient and internationally competitive financial system.

Earlier, Managing Director/Chief Executive of NDIC, Mr. Bello Hassan, said maintaining public confidence had become the most valuable asset of any financial system.

Hassan stated that trust painstakingly built over many years could be destroyed within days by uncertainty or misinformation.

He said rapid advances in fintech, artificial intelligence, and cross-border financial activities had created new opportunities for financial inclusion, but also introduced complex risks requiring coordinated responses from financial safety-net institutions.

Hassan said public awareness remained an indispensable pillar of effective deposit insurance because informed depositors were less likely to react irrationally to rumours during periods of uncertainty.

He also recalled the lessons from the 2023 global banking turmoil, describing it as the most severe episode of systemic financial stress since the 2007-2008 global financial crisis.

He said the crisis demonstrated how quickly confidence could erode in today’s digital environment, making preparedness, institutional coordination, and timely intervention essential to preventing wider financial contagion.

He reaffirmed NDIC’s commitment to strengthening depositor protection through enhanced reimbursement systems, sustained public awareness campaigns, stronger crisis management capabilities, and closer collaboration with CBN, Federal Ministry of Finance, and other financial safety-net institutions.

Hassan also called for deeper cooperation among African deposit insurers, saying the continent’s increasingly interconnected financial systems require stronger information sharing, technical collaboration, and coordinated responses to emerging risks.

The NDIC boss said, “Across the globe, deposit insurance systems are having to adapt to a rapidly changing financial environment shaped by digital innovation, fintech developments, artificial intelligence and increasing cross-border financial activities.

“While these developments present significant opportunities to expand financial inclusion and improve service delivery, they also create new risks that require proactive, coordinated responses from financial safety-net participants.”

According to him, “Confidence remains the most valuable asset in any financial system. Indeed, trust takes years to build but can be eroded within days if stakeholders perceive uncertainty or instability.

“As deposit insurers, central banks, supervisors, and resolution authorities, our collective responsibility extends beyond establishing protective frameworks; it includes ensuring that the public understands, trusts, and relies on those frameworks during both normal and turbulent times.”

Hassan stated, “Public awareness is, therefore, an essential pillar of effective deposit insurance systems, and a critical tool for deposit insurers. A well-informed depositor is more likely to make rational decisions and less likely to react adversely to rumours, misinformation, during periods of uncertainty.

“Public awareness must therefore be treated not as a peripheral concern but as a pillar of stability. This underscores the importance of the discussions we will have during this Workshop on building confidence in normal times and strengthening communication strategies during crises.”