Understanding Deposit Insurance in Trinidad and Tobago: What You Need to Know to Safeguard Your Savings

     

Securing Your Savings: A Guide to Deposit Insurance in Trinidad and Tobago

In today’s financial landscape, safeguarding your savings is more important than ever. Deposit Insurance plays a crucial role in this regard, offering protection for your deposits in the event of a financial institution's failure. Understanding how this system operates, the coverage it provides, and strategies to maximize your protection is essential for making informed financial decisions.

What is Deposit Insurance?

Deposit Insurance is a guarantee provided by the Deposit Insurance Corporation (DIC) of Trinidad and Tobago. It ensures that depositors are reimbursed up to a specific limit if their bank or financial institution fails. This mechanism is vital in maintaining public confidence in the financial system and in protecting individual savings.

Enhanced Coverage Limits

Over the years, the DIC has progressively increased the coverage limit to better protect depositors. Initially, the coverage was set at TT$75,000. In 2012, this amount was raised to TT$125,000. Effective October 1, 2024, the coverage will increase further to TT$200,000. This means that if a covered financial institution fails, the DIC will reimburse depositors up to TT$200,000 of each deposit account held.

Institutions Covered by Deposit Insurance

Not all financial institutions in Trinidad and Tobago are covered by the DIC. Below is a list of those that are:

Commercial Banks:

• ANSA Bank Limited
• Citibank (Trinidad and Tobago) Limited
• First Caribbean International Bank (Trinidad & Tobago) Limited
• First Citizens Bank Limited
• JMMB Bank (T&T) Limited
• RBC Royal Bank (Trinidad and Tobago) Limited
• Republic Bank Limited
• Scotiabank Trinidad and Tobago Limited

Finance Houses:

• Caribbean Finance Company Limited
• Fidelity Finance and Leasing Company Limited
• Island Finance Trinidad and Tobago Limited
• Massy Finance GFC Ltd

Trust Companies and Merchant Banks:

• ANSA Merchant Bank Limited
• Citicorp Merchant Bank Limited
• Development Finance Limited
• First Citizens Depository Services Limited
• First Citizens Trustee Services Limited
• Guardian Group Trust Limited
• JMMB Express Finance (T&T) Limited
• NCB Merchant Bank (Trinidad and Tobago) Limited
• RBC Investment Management (Caribbean) Limited
• RBC Merchant Bank (Caribbean) Limited
• RBC Trust (Trinidad and Tobago) Limited
• Scotia Investments Trinidad and Tobago Limited

Credit Unions: A Different Coverage Scheme

Credit Unions are not covered by the DIC but are instead protected by the Trinidad and Tobago Credit Union Deposit Insurance Fund (TTCUDIF). This fund provides insurance on shares and deposits held by members in the event of a credit union's liquidation, offering coverage of up to TT$125,000 on shares and TT$50,000 on deposits.

However, it is important to note that not all credit unions are covered by the TTCUDIF. As of 2020, only the following credit unions are included:

• Aero Services Credit Union Co-operative Society Limited
• Angostura Group Employees Credit Union Co-operative Society Limited
• Airport Authority Employees Credit Union Co-operative Society Limited
• Bethel Credit Union Co-operative Society Limited
• CEMCU Credit Union Co-operative Society Limited
• Central Community Credit Union Co-operative Society Limited
• Consolidated Telephones Credit Union Co-operative Society Limited
• Duncan Village Credit Union Co-operative Society Limited
• Government Printery Credit Union Co-operative Society Limited
• Guaymay Energy Alliance Credit Union Co-operative Society Limited
• Hand Arnold Credit Union Co-operative Society Limited
• Huggins Credit Union Co-operative Society Limited
• Lambeau Credit Union Co-operative Society Limited
• Progressive Credit Union Co-operative Society Limited
• Mt Pleasant Credit Union Co-operative Society Limited
• National Flour Mills (Employees Credit Union Co-operative Society Limited)
• PECU Credit Union Co-operative Society Limited
• PSCU Credit Union Co-operative Society Limited
• SFCCU Credit Union Co-operative Society Limited
• St Theresa's (Woodbrook) Credit Union Co-operative Society Limited
• TATECO Credit Union Co-operative Society Limited
• TATECO (San Fernando) Credit Co-operative Society Limited
• Teachers Credit Union Co-operative Society Limited
• Telephone Workers Credit Union Co-operative Society Limited
• TEXTEL Credit Union Co-operative Society Limited
• Transcorp Credit Union Co-operative Society Limited
• Trinidad and Tobago Fire Service Credit Union Co-operative Society Limited
• Trinidad and Tobago Police Credit Union Co-operative Society Limited
• Usine (Ste. Madeleine) Credit Union Co-operative Society Limited
• UWI Credit Union Co-operative Society Limited
• VENTURE Credit Union Co-operative Society Limited
• Whim Credit Union Co-operative Society Limited
• Zenith Credit Union Co-operative Society Limited

Strategies to Maximize Your Deposit Insurance Coverage

While Deposit Insurance provides substantial protection, it’s crucial to understand that coverage limits apply per depositor, per institution. For example, if you have TT$1 million in a single account at a bank, only TT$200,000 will be insured under the new DIC limit, leaving the remaining TT$800,000 uninsured.

To ensure maximum protection, consider the following strategies:

1. Diversify Across Institutions: Distribute your funds across multiple DIC-covered financial institutions. Each institution provides its own TT$200,000 coverage limit.

2. Utilize Multiple Accounts: If your deposits exceed the insured limit at a single institution, consider opening multiple accounts to extend your coverage. For example, with TT$1 million, you could open five accounts of TT$200,000 each to ensure full protection.

3. Understand Credit Union Coverage: When dealing with credit unions, be mindful of the TT$125,000 coverage limit on shares and the TT$50,000 limit on deposits. If your savings exceed these amounts, consider spreading your funds across different credit unions or maintaining multiple accounts within the covered credit unions.

Conclusion

Deposit Insurance is a crucial tool for protecting your savings in Trinidad and Tobago. As coverage limits increase, staying informed and taking proactive steps to optimize your protection is vital. Whether you are saving with a commercial bank, finance house, trust company, or credit union, understanding the coverage limits and strategically managing your accounts can help secure your financial future.

At CAIR, we are committed to empowering consumers with the knowledge and tools needed to make sound financial decisions. Choose institutions with reliable Deposit Insurance coverage, and ensure that your savings are fully protected.

References

https://www.facebook.com/cair.tt/

https://dictt.org/deposit-insurance/insured-financial-institutions/

http://stabfundtt.com/members/

https://www.facebook.com/photo/?fbid=923148969845783&set=pcb.923149743179039

https://www.facebook.com/photo?fbid=923149073179106&set=pcb.923149743179039