Opay meets NDIC N5m depositors fund insurance requirement

Onwubuke Melvin
Onwubuke Melvin

OPay, one of Nigeria’s major financial technology businesses, has guaranteed its customers that their deposits are now insured up to N5 million, the industry benchmark set by the Nigeria Deposit Insurance Corporation.

This was disclosed in a statement by Opay on Sunday.

This not only demonstrated its commitment to financial security but also matched it with the standards enjoyed by depositors at other commercial banks in the country.

In May, the NDIC stated that the maximum deposit insurance coverage for mobile money operators would be increased from N500,000 to N5,000,000 per subscriber. This change adds a significant safety net for OPay users, guaranteeing that their funds are substantially more secure.

The Managing Director/Chief Executive Officer of NDIC, Mr Bello Hassan, at the press conference announcing the increase, said, “The revised coverage is a strategic balance between protecting depositors and ensuring the stability of the financial system. These changes aim to extend protection to a larger percentage of the population, enhance financial inclusion, and mitigate the potentially destabilising effects of bank runs.”

He noted that the expanded coverage was supported by strong financial backing from the NDIC’s deposit insurance reserves, anticipated premium receipts, and powerful supervisory and bank resolution mechanisms described in NDIC Act No. 33, 2023.

Hassan underlined the need for this extensive financial infrastructure to maintain depositor confidence and safeguard the financial system’s stability.

OPay said, “This strategic enhancement not only aims to protect depositors but also encourages market discipline among banks and MMOs. By increasing the insured amount, the NDIC seeks to prevent unnecessary risk-taking by financial institutions, thereby reducing the potential for destabilising bank runs.

“OPay’s alignment with the NDIC’s revised insurance coverage standards underscores its dedication to safeguarding user funds and promoting financial stability. With this new level of insurance, OPay users can now have the same confidence in the security of their deposits as customers of other commercial banks. This move contributes significantly to a more inclusive and resilient financial ecosystem in Nigeria.”

OPay, set up in 2018 to make financial services more accessible through technology, provides a variety of payment services such as money transfers, bill payments, airtime and data purchases, card service, and merchant payments, among others.

OPay is licensed by the CBN and insured by the NDIC, providing the same insurance coverage as other commercial banks.

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