Government hails deposit protection scheme

Government hails deposit protection scheme

By Tichaona Kurewa

THE Government says the Deposit Protection Scheme has helped in fostering the banking public’s confidence through encouraging savings and contributing to the country’s economic development.

Addressing the International Association of Deposit Insurers (IADI), Africa Regional Committee (ARC) Conference and Annual General Meeting in Victoria Falls this Monday, Finance and Economic Development Minister, Professor Mthuli Ncube underscored the importance of the DPCZ in the economic development of the country.

“The presence of the Deposit Protection Scheme has been an enabler of confidence in the banking sector and this ensures financial stability, thus contributing to economic stability. Mobilisation of savings in the banking sector due to this confidence induced by the deposit insurance scheme enables banks to play their intermediation role,” he said.

Deposit Protection Corporation board chairperson, Agmos Moyo indicated that the five-day conference being attended by 18 countries will seek ways to build resilience for deposit insurance systems post COVID-19.

“The diversity of topics to be discussed includes an insight into some of the core principles for effective deposit insurance systems, an overview of key emerging issues for deposit insurance systems and financial sector regulators, implications of the digital revolution to the financial sector, regulation of e-money and digital products, impact of climate change on financial system stability, backstop funding arrangements during systemic crisis, differential premium systems and effective legal frameworks for dealing with parties at fault.”

Deposit insurance is an important component of the safety net whose players comprise the function of the lender of last resort and prudential regulation and supervision.