The Deposit Insurance Corporation (DIC) of Malawi has announced a sharp increase in its coverage limit to K3 million per depositor per bank, significantly boosting protection for savings held in the country’s commercial banks.

The revision represents a major leap from the K1 million coverage offered when the institution was launched in 2023, now protecting an estimated 92.7% of total bank deposits in the country.

The development was confirmed during a media engagement with members of the Association of Business Journalists (ABJ) in Blantyre.

“This increase is a reflection of the prevailing economic conditions and our legal mandate to revise the coverage annually,” said DIC operations manager Lowina Mwasigala.

“The current coverage ratio is now above the 80% international benchmark.”

The K3 million limit applies to all account holders, including those with foreign currency-denominated accounts.

In the event of a bank failure, insured depositors would be paid promptly up to the limit, while the remainder would be settled through liquidation procedures.

Mwasigala added that while the majority of smaller depositors are now fully insured, the sector remains stable in the short to medium term, with no imminent risks to the banking system.

Meanwhile, a summary of audited financial statements for the 15-month period ending December 31, 2024, shows the DIC recorded a surplus of K773.4 million, driven by an investment income of K2.3 billion.

The Deposit Insurance Fund now stands at K7.2 billion, signalling growing financial resilience.

Total assets amounted to K14 billion, with the bulk held in investment portfolios. The institution also posted a general reserve fund of K734.6 million and cash reserves of K1.68 billion, according to the financials.

The DIC was established by an Act of Parliament in March 2022 to enhance public confidence in the financial system and promote financial inclusion by safeguarding depositor funds in the event of bank failures.