The Nigeria Deposit Insurance Corporation (NDIC) has urged Nigerians to move more of their funds into the formal banking system. The Corporation recently increased the deposit insurance coverage from N500,000 to N5 million. This move aims to deepen public confidence in the banking system and encourage greater participation in the formal financial sector. The NDIC stated that the revised insurance limit now fully covers 98.98 per cent of depositors in Nigerian deposit money banks.
The Assistant Director, Communication and Public Affairs Department of the NDIC, Mr Adegbenga Fabuyi, made the call at the 2026 Finance Correspondents Association of Nigeria (FICAN) Conference and 36th Anniversary held in Lagos. Fabuyi emphasized that a resilient banking system cannot be achieved without public confidence. He stressed that the NDIC’s deposit insurance mandate remained central to protecting depositors and sustaining confidence in the financial system.
The NDIC's move is particularly important as Nigeria implements banking sector reforms, including the ongoing recapitalisation exercise designed to strengthen the capacity and resilience of banks. According to Fabuyi, the recapitalisation is aimed at providing Nigeria with a resilient banking system that supports the $1 trillion economy of the Federal Government. The NDIC's deposit insurance coverage provides an additional incentive for Nigerians who may still be reluctant to keep substantial amounts of money in banks.
Fabuyi also clarified a common misconception about the banking sector recapitalisation exercise. He explained that the fresh capital injected into banks should not be regarded as money that would automatically be available for lending to customers. Instead, banks would continue to depend largely on deposits mobilised from customers to support their lending and credit activities.
Fabuyi called for intensified efforts by banks, regulators, and the media to educate Nigerians on the importance of keeping their money within regulated financial institutions. He expressed concern that some Nigerians continue to keep large amounts of cash in homes, rooftops, farms, and other informal locations, exposing such funds to risks including theft, fire, and permanent loss.
The NDIC official also highlighted the Corporation’s role in the growing fintech ecosystem. The NDIC is supporting the expansion of digital financial services through deposit insurance coverage for eligible deposit-taking institutions operating within the regulated financial system. This includes mobile money operators and fintech-enabled microfinance banks.
Fabuyi commended FICAN for its longstanding relationship with the NDIC and its role in reporting developments in the financial sector. He urged financial correspondents to intensify public enlightenment on the revised deposit insurance limit and the protection available to depositors across the regulated financial system.
Key points
- The NDIC has increased deposit insurance coverage to N5m to deepen public confidence in the banking system.
- The Corporation's move aims to encourage greater participation in the formal financial sector.
- The NDIC is supporting the expansion of digital financial services through deposit insurance coverage.
