Consumer protection initiatives
There are a number of initiatives being developed in Bermuda designed to give added protection to consumers using financial services. This page provides information about the latest developments.
Deposit insurance scheme (DIS)
What will the deposit insurance scheme be?
The Bermuda Monetary Authority has worked in close collaboration with the Ministry of Finance, the International Monetary Fund (IMF) and the Bermuda banking sector to develop proposals for introducing a Deposit Insurance Scheme (DIS) in Bermuda.
The DIS is designed to protect small depositors in banks by guaranteeing up to a maximum specified amount of their deposits in the event of an institution's failure.
What will the BDIC be?
In 2012, the Bermuda Deposit Insurance Corporation (BDIC) was established as an independent body to administer and enforce the DIS, as well as to manage the DIS fund. The BDIC will serve several functions in this respect, including:
- Collecting premiums from all members of the DIS, that is Bermuda's banks, and investing them
- Issuing the prompt payment of compensation to insured depositors from the DIS fund, up to a current maximum limit of $25,000
- Educating the public on the DIS and its purpose
- Ensuring institutions adhere to the DIS
How will the DIS work?
All licensed banks will be required to make regular deposits of a predetermined amount to the DIS fund. This fund will then be used to reimburse depositors in the event of the bank's failure.
Who will benefit from the DIS and how?
Once the DIS is in place, retail and small business depositors of Bermuda's banks will have a measure of their deposits protected if their financial institution should suffer any significant failure.