Media Releases
Published Date: 27 June 2023

MAS Proposes to Increase Deposit Insurance Coverage

Singapore, 27 June 2023… The Monetary Authority of Singapore (MAS) today published a public consultation paper on proposals to increase deposit insurance (DI) coverage per depositor to S$100,000, and to improve the clarity and operational efficiency of the DI Scheme. 

MAS is proposing to increase DI coverage from S$75,000 to S$100,000 per depositor per DI Scheme member. The proposed increase will ensure that the vast majority of smaller depositors continue to be fully covered, keeping pace with the growth in average deposit balances. The proposed change will result in 91% of depositors being fully covered by deposit insurance and will ensure that DI continues to fulfil its primary objective of protecting small depositors in the event of a bank failure. This level of DI coverage strikes the appropriate balance between achieving a high degree of coverage for depositors and managing the cost of the coverage which, if too high, will ultimately be passed on to customers.

3 MAS is also proposing the following changes to enhance the operational efficacy of the DI Scheme:

  • provide MAS powers to stipulate a specific time when deposit balances are taken as final, so as to enhance clarity on how DI compensation is computed; and
  • introduce a time limit for DI compensation claims, to help keep administration costs low given the diminishing likelihood of claims over time.

These proposals arise from MAS’ periodic reviews of the DI Scheme to ensure that it continues to fulfil its objectives. The DI limit was last reviewed in 2019 when it was raised from S$50,000 to S$75,000, covering 91%At S$75,000, it fully insured 91% of depositors covered under the DI Scheme in 2019. With deposit growth since then, the percentage of fully insured depositors has fallen slightly to 89% in Q1 2022. of depositors at that time.

Ms Ho Hern Shin, Deputy Managing Director (Financial Supervision), MAS, said, “MAS’ proposals are not in response to the stresses faced by some banks abroad earlier in the year. The key to ensuring a safe and resilient banking system is through pre-emptive safeguards, meaning sound regulation and rigorous supervision by MAS, and effective governance and risk management by banks themselves. DI complements these safeguards by providing a safety net for small depositors in the event banks were to fail.  The DI safety net helps to provide confidence to small depositors but is no substitute to sound risk management and effective supervision.”

For more details, please refer to the consultation paper here . MAS invites interested parties to submit their comments on the proposals by 31 July 2023.  


Additional Information:

Please refer to MAS’ response to Parliamentary Question on 8 May 2023 here

DI Scheme members are full banks and finance companies as specified in Section 5 of the Deposit Insurance and Policy Owners’ Protection Schemes Act 2011.