Africa-Press – Uganda. The government has announced an increase in the Deposit Protection Fund (DPF) from Shs400billion to Shs1.3trillion.
The DPF is a government agency that provides deposit insurance to customers of deposit-taking institutions licensed by Bank of Uganda.
Also referred to as the Fund, the DPF was established as a separate legal entity following the enactment of the Financial Institutions (Amended) Act, 2016. Prior to this, DPF was managed by the Bank of Uganda.
The DPF board of directors chairperson Ben Patrick Kagoro, says the decision to increase the DPF is due to the rise in the number of people opening Bank accounts and need protection for their deposits.
“In 2017, we had 7 million account holders, but currently, 24 million accounts are being protected by the DPF,’’ he said on Friday during a public awareness meeting about the existence of a DPF in Jinja City.
Kagoro noted that the government first offered Shs400b as protection fund at the start of the initiative in 2017, which has grown to Shs1.3trillion.
He added that each bank account holder has a DPF insurance cover of up to Shs10m regardless of the amount deposited.
However, he hinted that the above amount will be increased in the next plans of action by the government with an aim of creating financial stability.
According to Kagoro, the deposit insurance limit currently covers 98 per cent of customers’ deposits, and there are parameters they have to follow while revising the deposit insurance cover, including involving the Ministry of Finance, and seeking parliamentary approval.
DPF chief executive officer Julia Clare Olima Oyet emphasized that they will “ensure that the review doesn’t affect the East African Community (EAC).”
She said: “We have to ensure that there is financial stability. We don’t want to destabilise the regional balance because we are under the EAC.”
Bank of Uganda Jinja branch administrator Teddy Namugga urged customers not to give up on the loss of their funds from any bank.
She advised that in case of any financial mishap and the line bank fails to provide a convincing solution, the matter should be forwarded to the Central Bank for further investigation.
This followed recent news in which social media has been dominated with complaints from customers allegedly losing money from their bank accounts under mysterious circumstances.
For More News And Analysis About Uganda Follow Africa-Press
