Regulatory Alerts2021-06-01
Added · Updated
Frequently Asked Questions on the Differential Premium System (DPS) – Risk-Based Premium Model
The Differential Premium System assigns insurance premiums to banks based on their specific risk profiles to promote better market discipline and reduce bank failures. Depositors do not pay these premiums, and they remain fully protected up to the KES 500,000 coverage limit, with additional amounts settled through the liquidation of bank assets. This risk-based model, implemented annually, is designed to be dynamic enough to account for macroeconomic fluctuations such as the Covid-19 pandemic.
Topics
Share