🏦 BanksWhat is the Kenya Deposit Insurance Corporation and what does it protect?
The Kenya Deposit Insurance Corporation (KDIC) has protected bank depositors since 1985 (first as the Deposit Protection Fund). It guarantees your money on deposit if a bank or mortgage finance company licensed under the Banking Act fails. It is funded by premiums the banks pay. Cover is up to KSh 500,000 per depositor, per bank — raised from KSh 100,000 in 2020 — it is automatic (you do not opt in), and it covers shilling and foreign-currency deposits. In this article we go through what is covered, what is not, and what SACCO members should know.
What is covered and how much
The scheme covers money in savings accounts, current accounts, fixed deposits and most other deposit accounts held with a KDIC member bank, up to KSh 500,000 per depositor, per bank. Your balances across accounts at the same bank are added together for the limit — it is a total, not KSh 500,000 per account.
For a joint account, each holder is generally covered for their share, in addition to their own individual accounts at that bank. Foreign-currency deposits are covered, converted to shillings for the limit. Cover is automatic — you do not need to register.
SACCOs are covered separately
KDIC covers banks, not SACCOs. Deposit-taking SACCOs are regulated by SASRA, and a separate Deposit Guarantee Fund for SACCOs is being built up to cover members up to KSh 100,000 per SACCO. If a large share of your savings is in a SACCO, check what protection currently applies.
Investments — unit trusts, money-market funds, shares, bonds, repos — are not deposits and are not covered by KDIC or the SACCO fund. Their value moves with the market. Money with an unlicensed 'investment' scheme is outside every guarantee.
If you hold large amounts
If you hold more than KSh 500,000 at one bank you can spread the money across several KDIC member banks to stay under the limit at each. For a very large balance, the strength of the bank matters more than the insurance — the limit only covers a fraction of it.
Be wary of any deposit-taker or 'chama' investment offering a return well above the market with no scheme behind it. A higher rate with no guarantee is more risk, not a better deal.
Frequently Asked Questions
- How much does KDIC cover?
- Up to KSh 500,000 per depositor, per bank (raised from KSh 100,000 in 2020). Balances across your accounts at the same bank are added together, so it is a total, not per account. Foreign-currency deposits are covered, converted to shillings.
- Are my SACCO savings covered by KDIC?
- No. KDIC covers banks. Deposit-taking SACCOs are under SASRA, and a separate Deposit Guarantee Fund for SACCOs is being established to cover members up to KSh 100,000 per SACCO. Confirm what protection currently applies to your SACCO.
- Is my money-market fund or unit trust covered by KDIC?
- No. Money-market funds, unit trusts, shares and bonds are investments, not deposits, so they are outside KDIC. They carry market risk. Only money in a deposit account at a KDIC member bank is covered.
Informational content, not financial, tax or legal advice. Check amounts, limits and current rules directly with the official sources (the NSSF, the Central Bank of Kenya, the Kenya Revenue Authority, the Kenya Deposit Insurance Corporation) before making a decision.
