Deposit insurance: The reliable protection for your hard-earned bank deposit

MANILA, Philippines — Aivie and her family almost lost all that they had when tropical storm Ondoy unleashed rains of epic proportions on September 26, 2009, submerging their home and everything in it. As soon as the flood waters subsided, they were faced with a very difficult question: how to pick up the pieces and move forward?

One of the keys to her family’s inspiring recovery was having money saved in a bank, which helped protect their finances from being wiped out by the infamous storm.  But if savings in banks protected her and many other families' finances from Ondoy’s fury, what then protects their hard-earned bank deposits?

Deposit insurance is a safety net mechanism provided by the government through the Philippine Deposit Insurance Corporation (PDIC), the agency designated by law to protect depositors and promote financial stability. The deposit insurance system provides depositors the confidence and peace of mind to maintain their hard-earned savings in banks, particularly for those who are dependent on their bank deposits for present and future needs. With deposit insurance in place, depositors can save without worrying about the safety of their money.

Deposit insurance is also critical in promoting financial stability as it helps heighten public confidence and entices individuals to save more in banks to help grow the economy. The depositing public is encouraged to continue using banking services without fear of losing their savings because of deposit insurance. It likewise helps mitigate risks by assuring depositors that their savings are protected up to the maximum deposit insurance coverage (MDIC), providing no reason to panic during challenging times.

All banks licensed to operate in the country such as commercial, thrift, rural and cooperative banks are covered by deposit insurance. If a bank is ordered closed by the Monetary Board of the Bangko Sentral ng Pilipinas (BSP), PDIC’s deposit insurance guarantees that depositors of the said bank will be promptly reimbursed up to the MDIC of P500,000 per depositor, per bank.

PDIC Tip: To estimate your insured deposits in a bank, use the PDIC’s Deposit Insurance e-Calculator at