Chronicle Editor
Midlands Bureau
The Deposit Protection Corporation (DPC) has urged members of the public to utilise registered financial institutions to safeguard their savings.
Speaking during the DPC Midlands awareness workshop held recently in Gweru, DPC chief executive officer Mr Hopewell Zinyau said its paybox plus
mandate compensates depositors up to a certain limit in the event registered financial institutions fail.
“We are mandated by the DPC Act to pay compensation to depositors in the event of insolvency of a contributing institution,” he said.
Mr Zinyau said 26 financial institutions are the current members made up of 13 commercial banks and others, one savings bank, four building societies, one infrastructure and development bank, and seven deposit-taking micro-finance institutions who are its members.
He said deposit protection is provided automatically on account opening with a member institution.
“Cover levels are up to US$1 000 per account for banks and US$500 for deposit taking micro-finance institutions or the ZWG equivalent. Cover limits to be reviewed in the first quarter of the year.
“About 96 percent of all valid existing bank accounts in Zimbabwe are covered meaning that if any of these banks fail today, we are able to compensate up to this level,” he said.
Banking Zinyau said members of the public dealing with unregistered micro-finance institutions are not beneficiaries of the scheme.
“It is very important to promote formal
banking channels so that people are covered in the unfortunate event of a bank failing, their deposits will be insured, and safe,” he said.
Mr Zinyau said the DPC is on a drive promoting financial literacy and inclusion even in the remotest of areas.
He said the public are at risk of being
prejudiced through financial pyramids like mukando.
“We do not encourage these financial pyramids because if someone disappears with your money you will be prejudiced because they do not have operating licences.
“When they come to us, we tell them that it is unfortunate this is a not registered financial institution, ” he said.
Mr Zinyau said the DPC does offsite supervision to ascertain viability of member banks.
DPC public relations manager Mr Allen Musadziruma addressing the same meeting assured depositors that their deposits are safe with member banks, who are registered financil institutions.
“We know that some people keep money under pillows, while others move around with it risking robberies.
“Money should be kept in the bank. Service fees are not that much because the risks that the banks are taking as custodians of those funds is very high.
“We are promoting financial inclusion,
and everyone should utilise the formal banking channel,” he said.
Mr Musadzimura said the DPC was also compensating depositors who lost savings during the migration from United States dollars to local currency a few years back.
“Ideally all people with bank accounts in
the banking sector are supposed to be compensated for loss of fund. It’s a gradual process and now at POSB and will move to other banks once funds become available,” he said.
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