It was announced that the Deposit Insurance Fund, which was established to guarantee depositors of banks and microfinance institutions, will provide guarantee to those who have deposits of up to 20000 Birr.
It is said that banks and macro financial institutions are required to contribute 2% of their deposits to the fund every year.
The Deputy Governor of the National Bank of Ethiopia, Mr. Solomon Sadha, told the reporter newspaper the following —
Each bank provides guarantee coverage for deposits up to 20000 Birr for each depositor.
The amount of the insurance cover is decided to provide the guarantee cover for the deposits up to 20000 Birr, because about 96 percent of the depositors have the mentioned amount of their deposits.
Accordingly, the insurance coverage is provided. This decision covers most depositors.
Banks make deposits to cover this guarantee every year by calculating 2% of their total deposits and making income for the fund.
There will be a fee charged by the banks when the Deposit Guarantee Fund service is launched. However, the amount of the money has not been decided yet. “