BUSINESS/FINANCE
Bank Account Deposit Protection Limit Doubled to Rs500,000 by Senate Committee
Senate Standing Committee on Finance, led by Senator Salim Mandviwala, has reviewed and discussed the Deposit Protection Corporation Amendment Bill 2024. The amendment seeks to enhance the legal protection for bank deposits, increasing the insured limit from Rs250,000 to Rs500,000.
During the meeting, the Deputy Governor of the State Bank of Pakistan informed the committee members that the new law would ensure that money up to Rs500,000 deposited in banks would now receive legal protection. This is a notable increase from the previous limit of Rs250,000, which was considered insufficient given the current economic environment.
Deposit protection schemes are designed to handle the failure of a bank on a standalone basis, aiming to reduce the chances of individual bank failures leading to widespread financial contagion and systemic risks. This amendment is a step forward in ensuring greater confidence among depositors and maintaining stability within the banking system.