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MAS proposes enhancement of deposit insurance coverage to S$75,000
THE Monetary Authority of Singapore (MAS) on Friday released a public consultation on its proposals to enhance the Deposit Insurance (DI) Scheme, with a key proposal to increase coverage to S$75,000 from the current S$50,000.
The DI scheme insures Singapore dollar deposits held at a full bank or finance company in Singapore. In a statement, the MAS said that the DI coverage limit was last raised from S$20,000 to S$50,000 in 2011 which, at the time, fully covered more than 90 per cent of insured depositors.
However, the percentage of fully covered insured depositors has since fallen to 87 per cent due to the growth in deposit base. The proposed coverage limit of S$75,000 will restore the percentage of fully insured depositors to above 90 per cent, in line with international norms, said MAS.
MAS proposes to achieve the targeted DI Fund size of 30 basis points of total insured deposits in a "progressive manner".
It said: "The plan is to extend the build-up period of the DI Fund from 2020 to 2028, and to revise the annual premium rates levied on full banks and finance companies from 2-7 basis points to 2.5-8 basis points".
The public consultation will end on Sept 4.