DPC quadruples microfinance protection to US$2,000

The Deposit Protection Corporation (DPC) has significantly increased deposit insurance cover for bank and microfinance institution customers, a move aimed at strengthening public confidence in Zimbabwe's financial system and enhancing depositor protection.

Under the revised framework, deposit insurance cover for bank customers will increase threefold from US$1,000 to US$3,000, while protection for clients of deposit-taking microfinance institutions will rise fourfold from US$500 to US$2,000.

The new limits will take effect on July 1.

Announcing the changes during the corporation's annual general meeting on Thursday, DPC chairman Canaan Dube said the decision followed a comprehensive actuarial assessment of the deposit protection scheme.

"It gives me great pleasure to announce that, following a thorough actuarial assessment, the board of directors has resolved to increase depositor protection cover limits," Dube said.

"For banks, the deposit protection limit will increase from US$1,000 to US$3,000. For deposit-taking microfinance institutions, the limit will increase from US$500 to US$2,000."

The enhanced coverage is expected to provide greater security to millions of account holders and reinforce confidence in the country's banking sector.

According to the DPC's 2025 Annual Report, Zimbabwe's banking sector had 6.88 million commercial bank deposit accounts at the end of 2025, comprising 4.23 million Zimbabwe Gold (ZiG)-denominated accounts and 2.64 million foreign-currency accounts.

The report shows that under the existing deposit protection framework, 99.4% of ZiG-denominated accounts and 96.3% of foreign-currency accounts were fully covered.

Despite the increase in depositor protection limits, Dube said participating institutions would not face higher contribution costs.

"Premium rates will remain at 0.30% for both contributing banking institutions and microfinance institutions," he said.

"The key message arising from this decision reflects our commitment to strengthening depositor protection, boosting public confidence and enhancing financial stability."

The DPC provides insurance cover to depositors in the event that a participating financial institution fails, ensuring that eligible depositors are compensated up to the prescribed protection limit.

The increase comes as authorities continue efforts to strengthen confidence in Zimbabwe's financial system following years of monetary instability and banking sector challenges.

Dube also revealed that the corporation had continued to strengthen its financial position through a diversified investment strategy focused largely on non-monetary assets.

A substantial portion of the DPC's investment portfolio is allocated to equities and real estate investment trusts (REITs), with investment returns benefiting from strong performance on both the Victoria Falls Stock Exchange and the Zimbabwe Stock Exchange during the review period.

He said the corporation would continue exploring investment opportunities across multiple asset classes in line with its approved investment policy framework.

The DPC's Deposit Protection Fund grew by 89% during 2025 to reach US$28.8 million, supported by a US$13.4 million surplus and strong investment returns.

The growth of the fund strengthens the corporation's ability to compensate depositors in the event of bank failures and provides an additional layer of stability within Zimbabwe's financial sector.

Industry observers say the increased protection limits should help reassure depositors and encourage greater participation in the formal banking system, particularly at a time when authorities are seeking to deepen financial inclusion and strengthen trust in financial institutions.