The Deposit Protection Corporation (DPC) on Tuesday increased the guarantee amount for all eligible depositors of its member banks from Rs500,000 to Rs 1,000,000 with effect from October 01, 2024, as decided by the Board of Directors of the Corporation.

“This enhanced guarantee amount now provides full protection to around 96 % of the eligible depositors,” the State Bank of Pakistan (SBP) said in a statement.

“The main objective of the deposit protection scheme is to safeguard the depositors’ interest and further enhance their confidence in the banking sector,” it added.

The SBP said that the move will also support financial stability in the country.

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The deposit protection facility applies to all eligible depositors and does not require any fee from the depositors.

The guarantee amount or protected deposit becomes payable to eligible depositors only if the State Bank of Pakistan declares a bank as a failed bank and is not payable under any other circumstances.