The Nigeria Deposit Insurance Corporation (NDIC) has initiated a public consultation process seeking feedback on the revision of the International Association of Deposit Insurers (IADI) Core Principles for Effective Deposit Insurance Systems. This revision, launched by IADI in May 2025, aims to modernize the global framework governing deposit insurance to reflect the evolving dynamics of the financial landscape. The NDIC, a founding member of IADI, plays a crucial role in safeguarding depositors’ interests within Nigeria’s financial system and actively participates in international efforts to strengthen deposit insurance practices globally.
The IADI Core Principles serve as a benchmark for evaluating the effectiveness of deposit insurance systems worldwide. Jurisdictions, including Nigeria, utilize these principles to assess the quality of their own systems, identify areas for improvement, and implement necessary measures to enhance their deposit insurance frameworks. International financial institutions, such as the International Monetary Fund (IMF) and the World Bank, also employ the Core Principles within their Financial Sector Assessment Programme to gauge the robustness of deposit insurance systems in various jurisdictions. The ongoing revision will ensure that these principles remain relevant and effective in addressing emerging challenges and opportunities in the global financial landscape.
The current revision is particularly significant as it seeks to address key structural changes within the financial system. These include the rapid advancements in digital innovation, the increasing involvement of deposit insurers in resolution processes, and the valuable lessons learned from the banking turmoil of March 2023, which represents the most significant systemic stress event since the 2007-2009 global financial crisis. By incorporating these considerations, the revised Core Principles will provide a more robust and contemporary framework for deposit insurance systems worldwide.
The banking crisis of March 2023 highlighted the vulnerabilities of the global financial system and underscored the essential role of effective deposit insurance in maintaining financial stability. The rapid pace of technological change, particularly in the realm of digital finance, presents both opportunities and challenges for deposit insurers. The revised Core Principles will need to address these complexities and provide guidance on how deposit insurance systems can effectively adapt to the digital age while ensuring the protection of depositors’ funds.
The IADI’s role in promoting international cooperation and sharing best practices in deposit insurance is critical in fostering a stable and resilient global financial system. The NDIC’s active participation in this revision process reflects its commitment to strengthening deposit insurance practices both domestically and internationally. The public consultation process initiated by the NDIC will ensure that the perspectives of various stakeholders, including financial institutions, policymakers, and the general public, are incorporated into the revised Core Principles.
This collaborative approach to revising the IADI Core Principles underscores the importance of a global perspective in addressing the challenges and opportunities presented by the evolving financial landscape. The revised principles will provide a valuable framework for strengthening deposit insurance systems worldwide, enhancing financial stability, and protecting the interests of depositors in an increasingly complex and interconnected global economy. The NDIC’s efforts to solicit feedback from a wide range of stakeholders demonstrate its commitment to ensuring that the revised principles are practical, effective, and responsive to the needs of all participants in the financial system.
