Deposit guaranteed amount for bank customers increased twice

State Bank of Pakistan has issued on Tuesday a statement that the Deposit Protection Corporation has hiked the guaranteed amount for qualified depositors of member banks to Rs. 1mn from Rs. 500,000, effective October 1, 2024. The decision has been taken by the Board of Directors of the Corporation.

This, according to the regulator, will cover nearly 96% of eligible depositors, who will be fully protected. The main objective of the deposit protection scheme, according to the central bank, is to protect depositors’ interests and strengthen their trust in the banking sector, which subsequently contributes to financial stability.

SBP also clarified that this facility of deposit protection would be free of charge to all the eligible depositors. This facility would not attract any charges. The amount of guarantee will also be paid only on an event when the State Bank of Pakistan declares a bank failed and it is not payable on any other occasion.