The Nigeria Deposit Insurance Corporation (NDIC) on Tuesday disclosed that as at the end of the second quarter of this year it had paid a total of N11.67 billion in insured sums to 535, 815 depositors of failed banks over the years.
The corporation’s Managing Director, Mr. Bello Hassan, made the disclosure during its special day at the ongoing 16th Abuja International Trade Fair.
Hassan, who was represented at the event by the corporation’s Director Corporate Communications, Mallam Bashir Nuhu, disclosed that a total of N6.16 billion had been paid as liquidation dividend to 1,955 creditors and shareholders of closed banks.
The NDIC boss further Hassan further said that the corporation had also declared full payment of insured and uninsured sums to depositors of eighteen (18) banks in-liquidation.
In practice, depositors with balances in excess of the insured sums are usually paid liquidation dividends, which often extend to the banks’ creditors and shareholders.
As provided for in the NDIC Act 2006, when insured financial institutions fail, depositors of Deposit Money Banks (DMBs), Non-Interest Banks (NIBs), Primary Mortgage Banks (PMBs) and subscribers of Mobile Money Operators (MMOs) are reimbursed up to a maximum limit of N500,000 while the maximum insured coverage for depositors of Microfinance Bank (MFBs) is N200,000
In furtherance of its efforts to sustain public confidence in the banking system, the corporation has extended its deposit insurance coverage to the recently licensed Payment Service Banks (PSBs) to the tune of N500,000 per depositor.
Meanwhile, Hassan also cautioned bank depositors on Ponzi Schemes’ transactions despite the juicy promises on investment returns by their promoters, stressing that the schemes are illegal and that the promoters are only out to dupe unsuspecting depositors.
He said: “I would also like to serve a word of caution against patronizing unscrupulous services of Ponzi Schemes and illegal fund managers, otherwise called ‘wonder banks’ who masquerade as deposit-taking institutions to dupe unsuspecting members of the public of their hard-earned funds.
“They offer unrealistically high returns to lure their victims only to bolt away with their money. These entities are not licensed by the CBN as deposit-taking institutions and are therefore not covered by the deposit insurance”, the deposit insurance expert stressed.
Hassan further pointed out that Ponzi Schemes’ operators were not licensed by the NDIC and that this implies that any money invested in their schemes are not protected.
The NDIC boss said that the corporation’s participation at the Trade Fair was part of its public enlightenment campaigns to continuously educate the investing public on legitimate transactions with the banks.
He said: “We engage in all the major trade fairs across the nation, not to market goods, but to market our services.
“We Inculcate banking habits, financial inclusion and inform the public about the dangers of not taking their money to the bank.
“We have developed an app to enable depositors to fill in their claims when their money is trapped in a bank and apply for their money”, Hassan added.
