Deposit Insurance
Deposit Insurance Meaning:
In banking terminology, the term Deposit Insurance refers to a type of protection for funds held in a financial or other depository institution and is sometimes also called Deposit Protection. Deposit Insurance is generally offered by government agencies to safeguard depositor’s funds from risk of loss as a result of the failure of the financial institution.
In banking terminology, the term Deposit Insurance refers to a type of protection for funds held in a financial or other depository institution and is sometimes also called Deposit Protection. Deposit Insurance is generally offered by government agencies to safeguard depositor’s funds from risk of loss as a result of the failure of the financial institution.
For example, Deposit Insurance in the United States is extended to depositors of member banks and financial institutions of the Federal Deposit Insurance Corporation or FDIC. The FDIC claims to be backed by the full faith and credit of the United States, and it extends its standard insurance to deposits of $250,000 per depositor, per insured bank for each of its account ownership categories. Deposit Insurance is offered in other countries, typically with different criteria regarding the amount of funds insured. These nations including the United Kingdom, Canada and most of the member nations of the European Union, as well as Australia, New Zealand, Japan, India, Malaysia and Thailand, to mention only a few.