- Aiming for 7.3 bln Birr premium
ADDIS ABABA – The Ethiopian Deposit Insurance Fund (EDIF) announced that it collected approximately 6.51 billion Birr from member financial institutions during the past fiscal year.
Speaking at a media briefing yesterday, EDIF CEO Dessalegn Ambaw (PhD) stated that the fund had originally planned to collect 6 billion Birr in premiums but exceeded the target by amassing 6.51 billion Birr. He indicated that the organization is utilizing modern facilities to enhance service efficiency, build trust among depositors, and contribute to financial stability.
Dessalegn further said that the Commercial Bank of Ethiopia, private banks, and all microfinance institutions are members of the fund. The insurance scheme provides coverage of up to 100,000 Birr per depositor at each member financial institution.
He explained that member institutions contribute around 0.3% of their total average deposits annually. EDIF is aiming to generate a 7.3 billion Birr premium in the current fiscal year.
“Ethiopia ranks 148th globally in establishing a deposit insurance fund,” Dessalegn remarked, noting that there are currently 86 member financial institutions, including 31 commercial banks and 55 microfinance entities.
Fund Operations Director MergaWakwoya stressed that EDIF is committed to expanding insurance coverage based on research and international best practices, with a focus on protecting financial institutions and maintaining depositor confidence.
Merga also pointed out that 97% of Ethiopian citizens with deposits below 100,000 Birr are covered by the insurance. Additionally, the fund is conducting research to further enhance deposit coverage, with 98.93% of the premiums collected from banks and 1.07% from microfinance institutions.
The EDIF is a government-backed organization established to protect depositors in the Ethiopian financial system. It acts as a safety net, ensuring that depositors receive compensation in the event of a member financial institution’s failure.
BY ASHENAFI ANIMUT
The Ethiopian Herald September 27/2024
