Deposit Insurance Scheme Singapore: Protecting Your Savings

What is Deposit Insurance?

Deposit insurance is a financial guarantee provided by the government to protect depositors' savings in the event of a bank failure. In Singapore, the Deposit Insurance Scheme (DIS) is administered by the Singapore Deposit Insurance Corporation (SDIC).

Why is Deposit Insurance Important?

Deposit insurance plays a crucial role in maintaining financial stability and confidence in the banking system. It:

• Protects depositors from losing their savings in case of a bank failure.
• Encourages savings and investments by providing a safety net for deposits.
• Prevents bank runs and systemic financial crises.

Coverage and Limits

The DIS covers all deposits in licensed banks in Singapore, including demand and savings accounts, fixed deposits, and foreign currency deposits. The coverage limit is currently S$75,000 per individual depositor per bank.

How to Check Coverage

To check your coverage, you can refer to the following table:

Joint Accounts

For joint accounts, coverage is limited to S$75,000 per individual depositor, regardless of the number of co-owners. For example, if an account is jointly held by two individuals, the coverage limit is S$150,000 (S$75,000 for each individual).

Excluded Deposits

The following types of deposits are not covered under the DIS:

• Deposits in non-bank financial institutions
• Deposits in foreign banks
• Deposits made by banks themselves
• Deposits made by government entities
• Negotiable instruments (e.g., checks, bills of exchange)

Claims Process

If a bank fails and the DIS is activated, depositors can file a claim with the SDIC. Claims are typically processed within 10 working days. Depositors will receive the amount of their eligible deposits, up to the coverage limit.

History of the DIS

The DIS was first introduced in Singapore in 1985. Over the years, the coverage limit has been increased several times to keep pace with inflation and economic growth.

Recent Developments

• 2018: The coverage limit was increased from S$50,000 to S$75,000.
• 2020: The DIS was extended to cover all deposits in foreign currency.

Conclusion

The Deposit Insurance Scheme is a vital component of Singapore's financial system, providing protection to depositors and maintaining confidence in the banking industry. With coverage of up to S$75,000 per individual depositor, the DIS ensures that the vast majority of deposits are safeguarded in the event of a bank failure.