Deposit insurance extended to digital deposits

Deposit insurance, introduced in Ghana in September 2019 to protect depositors in banks and specialised deposit-taking institutions, is now being extended to depositors on licensed electronic money platforms.

The Ghana Deposit Protection Corporation (GDPC), in close collaboration with the Bank of Ghana, is actively working to implement this mandate following the passage of the Ghana Deposit Protection (Amendment) Bill, 2025, which received Presidential Assent on March 31, 2026. Under the new legislation, funds held in mobile money (MoMo) wallets and other digital platforms are now legally recognised under Ghana’s deposit insurance framework.

The GDPC Board has commenced the regulatory review and restructuring required by the amendment. It is working to transition the Corporation’s mandate beyond its traditional “pay-box” model to a more comprehensive financial safety net.

Because mobile money involves complex structures, such as trust accounts held at commercial banks by Electronic Money Issuers (EMIs), including MTN Fintech MoMo, Telecel and AT Money, the GDPC is structuring the protection to ensure it can be implemented effectively.

This involves transitioning from a “pay-box” model of providing deposit insurance to a “pass-through” model.

The “pay-box” model is a narrow deposit insurance mandate under which the insurer’s legal responsibility is limited to collecting premiums, managing the insurance fund and reimbursing insured depositors only after a financial institution officially fails or enters liquidation. It has no role in bank supervision, early intervention or active loss-minimisation resolution.

Under the newly enacted framework, the operationalisation of explicit e-money coverage limits is undergoing initial structuring by the GDPC Board. However, because mobile money float balances are legally required to be held in trust accounts at commercial banks, the current mechanics require the system to operate under a “pass-through” deposit insurance model.

Under the 2025 amendment, insurance protection “passes through” the aggregate trust account directly to individual wallet holders. This means each individual depositor’s mobile money wallet balance is protected up to the legal maximum compensation of GH¢6,250, irrespective of the amount held by other users in the same trust account.

However, the Ghana Deposit Protection (Amendment) Bill explicitly grants the GDPC Board the mandate to review and increase the coverage limits every two years to reflect macroeconomic conditions and inflation.

To prevent the cost from being passed on to consumers, digital wallet users will not pay any direct fees for the protection. Instead, the platforms will pay premiums directly to the Corporation.

The foundational Ghana Deposit Protection Act, 2018 (Act 931), establishes that member institutions pay an annual premium ranging between 0.3% and 1.5% of their total eligible deposits. The exact premium rate applicable to e-money platforms will be determined dynamically based on the financial grading and risk profile of the partner bank hosting the float trust accounts, alongside operational compliance audits conducted by the GDPC.

Recent data from the Bank of Ghana shows that customer mobile money float balances have reached a record GH¢40 billion. This represents an increase of more than 38% from the previous year, further cementing digital wallets as major stores of value for households and small businesses.

Telecom-led platforms (MNOs) completely dominate the ecosystem, commanding approximately 92% of the market share. MTN Mobile Money (MoMo) holds the largest share of the float, with customer wallet balances of GH¢38.4 billion. The remaining telecom market share is divided between Telecel Cash and AT Money. Independent fintech platforms, dedicated Electronic Money Issuers (EMIs) and bank-led digital applications account for the remaining 8% of the market.

The need to extend deposit insurance to e-money deposits has emerged from the sheer scale of the rapidly growing industry underpinning these deposits. According to data from the Ghana Chamber of Telecommunications, mobile money transactions reached GH¢3.6 trillion in the first ten months of 2025 alone, across 74 million registered accounts.

Previously, if a bank failed, direct depositors were protected up to the legal coverage limit, while MoMo wallet balances remained entirely outside this insurance safety net. The new law legally bridges this gap to ensure that digital financial assets receive protection.

Ghana’s deposit insurance scheme became operational in September 2019 and is administered by the GDPC in collaboration with the Bank of Ghana. Until now, it has covered eligible deposits held with universal banks and specialised deposit-taking institutions (SDIs), automatically and at no direct cost to customers.

Customers with accounts at licensed universal banks and SDIs are automatically covered without having to register or pay separate fees. The framework operates a two-fund system: Fund A handles reimbursements for universal bank depositors, while Fund B covers specialised deposit-taking institutions.

A payout trigger is activated when a financial institution’s licence is officially revoked and a receiver or liquidator is appointed by the Bank of Ghana.

The GDPC aims to announce payout procedures within six days of an insured event and distribute valid claims within 30 days. Unclaimed funds remain claimable for up to five years, after which they are forfeited to the Corporation.

However, certain entities and situations are excluded from payouts. These include insider deposits belonging to directors, key management personnel and external auditors of the failed institution; government and inter-bank or financial institution holdings; frozen or court-ordered accounts; anonymous or unidentified deposits; and accounts pledged as direct loan collateral.