The Nigeria Deposit Insurance Corporation (NDIC) has issued a stern warning to traders and business owners, urging them to refrain from engaging with wonder banks and ponzi schemes.
Bello Hassan, the Managing Director/Chief Executive of NDIC, delivered this cautionary message during the NDIC Special Day at the 2023 Lagos International Trade Fair.
Hassan emphasized that the Deposit Insurance Scheme (DIS) was established to safeguard the interests of small depositors.
It serves as a mechanism for reimbursement in the event of imminent or actual bank failures, all the while promoting safe and sound banking practices, contributing to an orderly payments system, and fostering fair competition within the banking sector.
He elucidated on the core functions of the DIS, describing it as a “risk minimizer” with responsibilities encompassing deposit guarantee, bank supervision, distress resolution, and the liquidation of failed insured deposit-taking financial institutions.
Collaborating closely with the Central Bank of Nigeria (CBN), the NDIC plays a crucial role in ensuring the safety, soundness, and stability of the financial system. This collaboration aims to instill public confidence in Nigeria’s banking system.
While underscoring the ongoing partnership with the CBN to supervise banks effectively and maintain adherence to prudential thresholds and the Code of Corporate Governance for banks, Hassan urged the general public, particularly traders and businessmen, to prioritize licensed banks for their financial dealings.
He advised against patronizing wonder banks and ponzi schemes, cautioning that such practices often leave victims with distressing stories.
The NDIC’s proactive stance seeks to protect the financial interests of the public and maintain the integrity of the Nigerian banking system.
