The Nigeria Deposit Insurance Corporation (NDIC) has said its payment of N5 million to N2 million as a deposit guarantee to depositors of commercial banks that have been liquidated is informed by the provisions of extant laws.
The Managing Director (MD) of NDIC, Mr Thompson Oludare Sunday, disclosed this during the 2026 budget defence session of the House of Representatives Committee on Insurance and Actuarial Matters.
He explained that one of the NDIC’s major mandates is deposit guarantee adding that in performing the function, NDIC receives premium from banks for the deposits that they hold which used to be 15 over 16 of 1% of the deposit.
He, however, informed that it is now based on an assessment of the risk of the institution.
“In other words, we do not collect all the deposits that banks receive. What we take is premium, which is now less than 1%. It used to be 15 over 16 of 1%.
“So, we guarantee the deposit on that basis. The job we do is different from other deposit-taking companies like insurance companies because for us, the premium is paid by the bank.
“The depositor benefits when there is a crisis, and the NDIC is there to make sure that the banks are properly run. The guaranteed sum is N5 million for PMBs, MMOs and deposit money banks. For other financial institutions, we refer to microfinance banks as other financial institutions; it’s N2 million. So, that is the guaranteed sum.
“Maybe, there will be something more outside that. So, the first thing we do, even without you having to come to the corporation or go to the bank, we use your BVN to locate your account in other banks, and we send N5 million or N2 million, depending on the class of the institution. Anything N5 million below, we send without you having to come.
Speaking, Chairman of the committee, Hon. Ahmed Jaha commended the MD for the clarification, saying that he had cleared the doubt about what the NDIC is responsible for and what it is not responsible for in line with its mandate.
He said, “You know, some people thought NDIC covers every deposit. They have a limit. In fact, it was recently increased from N500 per depositor to N5 million per depositor. Then, I think, a few weeks or a few months after that, Heritage Bank was down.
“And it may interest members to know that more than 90% of the depositors were paid their insured amount in less than four days”.
