NDIC Pegs Coverage to Mobile Money Users at N500,000

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The Nigeria Deposit Insurance Corporation (NDIC) has said it will provide deposit insurance coverage of N500,000 maximum limit to subscribers of Mobile Money Operators (MMOs).

Speaking during NDIC’s Special Day at the 33rd Lagos International Trade Fair in Lagos, NDIC Managing Director/CEO Umaru Ibrahim, said one of the most significant achievements of the corporation is the provision of the deposit insurance coverage to subscribers of mobile money operators to the maximum limit of N500,000 through the pass-through deposit insurance framework.”

Umaru, who was represented by Joshua Utopidok, the Director for Special Insured Institutions, said: “As it stands, the number of licensed MMOs by the Central Bank of Nigeria is 23, with eight being bank-led and the remaining non-bank-led. As of 30th June 2019, the number of subscribers to the MMOs stood at 9,249,265.

Ibrahim said following the issuance of the “framework for the Licensing and Regulation of Payment Service banks (PSBs) by the CBN, which stipulated the extension of Deposit Insurance Coverage to the depositors, the Corporation has designed an appropriate Differential Premium Assessment System (DPAS) Matrix for Premium computation/payment as well as set an Insurable Limit to the Depositors in the event of failure’’.

He said the “corporation is taking these measures so as to engender confidence in the system and to discourage bank customers from keeping cash at homes, shops and other places outside the banks. “Money kept outside the banks are not insured by the corporation and are susceptible to loss through robbery, theft or fire outbreak.”

“As provided for in the NDIC Act 2006, when insured financial institutions fail, depositors of deposit money banks (DMBs), non-interest banks (NIB) and primary mortgage banks (PMBs) are reimbursed up to a maximum limit of N500,000, while the maximum insured coverage for depositors of Microfinance bank (MFBs) is N200,000.

“However, the insured limits are periodically reviewed by the board of the corporation to ensure that the majority of depositors are covered.”

According to Ibrahim, the corporation received 35 petitions and complaints from bank customers on issues, such as the ATM frauds, un-authorised fund transfers, and cheque related issues.