Deposit Insurance Limit Increase to RM250,000



PIDM

With effective from 31st December 2010, deposit insurance limit will be increased to RM250,000 from RM60,000 per depositor per bank. The new limit come into force after it was approved by Dewan Rakyat and Dewan Negara recently.

The new limit will protect 99% of retail depositors in full. In addition, the new bills will also includes foreign currency deposits under the deposit insurance protection.

The enhanced financial consumer protection package included the expansion of Perbadanan Insurans Deposit Malaysia (PIDM) mandate to include the administration of the Takaful and Insurance Benefits Protection System (TIPS).

The Bill will replace the PIDM Act 2005. It will widen PIDM’s mandate, roles and responsibilities to protect depositors in the event of a member institution failure.

PIDM is the Government agency protecting depositors against the loss of their funds in the event of a member bank failure. Member banks comprise all commercial and Islamic banks, including locally incorporated foreign banks, in Malaysia.

On 11th May 2010, Prime Minister Datuk Seri Mohd Najib Razak, who is also Finance Minister, announced the increase of the deposit insurance limit to RM250,000 by 1st January 2011.


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