The place of residence or nationality does not affect deposit insurance protection, as long as the depositor has account placed with a member bank of PDIC.
Example Account holder Type of deposit Balance $ Ahmad’s share Wife’s share Son’s share Ahmad Current 13,000 13000 Ahmad Saving 7000 7000 Ahmad and wife Joint 15,000 7500 7500 Ahmad , wife and son Joint 12,000 4000 4000 4000 Total 47,000 31,500 11,500 4,000 Protected $ 20,000 11,500 4,000
The deposits in different member banks are protected separately. The $20,000 deposit insurance limit is applicable per depositor per member bank.
The PDIC pays out $20,000 for each depositor within thirty days of submitting their claims; afterwards, depositors will be reimbursed from the proceedings of the liquidated bank, according to legal priority of claims per PDIC law.
The coverage limit is up to $20,000 (Twenty thousand US dollar) or equivalent in other currencies per depositor per member bank.
The depositor incurs no cost for deposit insurance protection.
PDIC sources of funding include annual subscription fees collected from member banks as a percentage from total insured deposits. The premiums are used to build reserves to meet payments to depositors in the event of a member bank failure. PDIC deposit insurance system provides protection for both Islamic and conventional deposits. Hence, PDIC maintains and administers two separate deposit insurance funds: Islamic deposit insurance fund (that are sharia compliant) and Conventional deposit insurance fund. In the event of a bank liquidation, PDIC bears the responsibility to liquidate the bank and reimburse depositors.
In the event of a member bank failure, PDIC will promptly reimburse depositors by the coverage limit of $ 20,000 or equivalent in other currencies. Deposits that exceed the coverage limit will be settled following a bank liquidation . PDIC covered about 94.68% of depositors whose deposits were subject to the provision of the law.
All commercial and Islamic banks operating in Palestine and licensed by Palestine Monetary Authority (PMA) Membership is compulsory for all banks licensed by the PMA
Depositors do not need to apply or register for deposit insurance protection. Deposit insurance is provided automatically for eligible deposit accounts placed with member banks.
.PDIC insures deposits in all currencies with coverage limit up to $20,000 or equivalent in other currencies per depositor per member bank
PDIC insures all types of deposits for individuals, institutions, residents and non-residents, including: -Current and demand deposits -Saving deposits. -Term and subject to notice deposits. -Joint deposits accounts that belong to more than one person. Excluding the following deposits: -Deposits of the government and its agencies. -Deposits of the PMA -Deposits between members and other financial institutions -Cash guarantees within the limits of the amount of guaranteed facilities -Deposits of related person, in accordance with the provisions of the banking law currently in force. -Deposits of the auditor of member and/or members of its Sharia supervisory board -Restricted investment deposits, as determined by the board Other financial institutions : -Deposits of insurance companies and reinsurance companies licensed by Palestine Capital Market Authority. -Deposits of brokerage firms licensed by the Palestine Capital Market Authority. -Deposits of Specialized lending institution licensed by the PMA.
Upon the merger process of any two banks, the rights of the depositors will remain at the acquired bank and /or the new bank resulting from the merger, and the balance of the account will be kept, ensuring that all deposits are insured by the PDIC at the specified coverage limit.
PDIC will make public announcements to notify depositors on how and when reimbursement of insured deposits will take place. PDIC will also make available communications channels, including its Call Centre and website for the public to inquire about the status of their deposits and submit their claims accordingly. The reimbursement sum becomes payable once the liquidation decision is published by PMA, and must be paid by the PDIC within a period of one month from the date on which the claim was submitted.