Insurance company: Faint role of Vietnam Deposit Insurance

Insurace company: According to a small survey, almost depositors "forget" deposit insurance on bank deposits. Deposit insurance is a risk precautions are many countries established to protect depositors in case a bank's inability to pay.

Insurace company: In most countries, the deposit insurance system was established by the government or the central bank. Therefore, the deposit insurance organization is the safety, the reliability, the security for customers' deposits in the banking system.

At the same time, deposit insurance institutions also perform another important task is to prevent and handle bank crises to ensure safety for the entire micro-finance systems.

However, these activities restructuring the banking system last trade in Vietnam does not have a firm imprint of deposit insurance. At the same time, according to a small survey, almost depositors "forgotten" when deposit insurance on bank deposits.

Faint role of deposit insurers

The primary role of deposit insurance is to supervise and check the safety of members participating in the deposit insurance. So that, insurance company will intervene and prevent the crisis could lead to collapse of the banking system. Yet, from the deployment schemes 254 "Restructuring the system of credit institutions period 2011 to 2015", the only role on each central bank to undertake. The shouldering too much responsibility of the central bank will overload and reduce management efficiency - operating monetary policy.

In addition, the ultimate goal is the protection of the insurance company to the depositors. But this also became too "luxury" for depositors. By the majority of them did not care about deposit insurance element when depositors.

Specifically, according to the survey, customers send money from the insurance brand reputation because banks accounted for 14%, 19% interest rates, deposit insurance is 9%, the rest are all factors. However, according to a survey from the author, more than 61% of customers send money known deposit insurance, but 95% do not care for that.

Insurace company: Thus, there is a question to be posed "apparently, the existence of is a burden?” If that happens, it will impact significantly on the national financial security. According to network model by the national financial safety, four strong pillars with a solid legal framework, dividing clear mandates and effective coordination mechanisms that created financial stability. The four pillars are: the Ministry of Finance, the deposit insurance institutions, central banks, and other monitoring organizations. However, in Vietnam, the central banks are pillars bear almost the entire three remaining pillars. One pillar "sooner or later" will lead to financial instability in the future.