KARACHI: The Deposit Protection Corporation (DPC) has proposed “appropriate” changes in its statute to enhance its scope so that MFBs become compulsory members of DPC, enabling it to provide coverage to their depositors.
Currently, some 37 scheduled banks operating in Pakistan are members of DPC, which provides deposit protection to more than 98 percent of total 73 million depositors of scheduled banks in Pakistan.
The DPC, a subsidiary of the State Bank of Pakistan (SBP), on Friday has released its third Annual Report for the year 2022-23 with objective to enhance awareness among bank depositors and general public regarding protection of deposits of its member banks.
The Annual Report emphasises DPC’s unwavering commitment to safeguarding depositors’ funds, strengthening financial stability, and continually enhancing the horizon of deposit protection.
According to report under the current deposit protection mechanism, 98 percent of all the depositors of member banks are eligible for coverage by the Corporation. The coverage provided to such depositors was Rs 250,000 per depositor per bank at the time of inception of the Corporation in June 2018. However, the coverage was increased to Rs 500,000 in September 2021.
The current coverage amount is sufficient to fully cover 94 percent of total depositors; while the remaining 4 percent will be partially covered by DPC; however, their additional balances may also be protected through other measures such as resolution or liquidation proceeds.
Copyright Business Recorder, 2023