The Nigeria Deposit Insurance Corporation (NDIC) has issued a stern warning to the public to steer clear of financial institutions operating without Central Bank of Nigeria (CBN) authorization, as well as schemes promising unusually high returns (Ponzi schemes).
At the 20th Abuja International Trade Fair, under the theme “Sustainability: Consumption, Incentives and Taxation,” Dr. Oludare Sunday, NDIC’s managing director/CEO, delivered the caution to Nigerians.
Represented by Olabimpe Akande, the director of its Performance Management Department, Dr. Sunday stressed that only banks and fintech firms licensed by the CBN and insured by NDIC should be entrusted with public funds.
He affirmed that NDIC insures deposits in Deposit Money Banks (DMBs), Non-Interest Banks, and Mobile Money Operators up to ₦5 million, while depositors in Payment Service Banks (PSBs), Microfinance Banks (MFBs), and Primary Mortgage Banks (PMBs) are covered up to ₦2 million.
Dr. Sunday also explained the process for recoveries when a bank fails: depositors receive up to the insured amount immediately, and any excess is paid later via liquidation dividends derived from the sale of the failed institution’s assets.
He cited the revocation of Heritage Bank’s license in June 2024 as a case in point: insured depositors were paid swiftly, with liquidation dividends distributed later as asset recovery proceeded.
In closing, NDIC reiterated its commitment to safeguarding public deposits and maintaining confidence in the banking system through rigorous oversight, coordination with CBN, and enforcement of licensing standards.
[Source: ThisDayLive]
