PIDM? What is PIDM?

PIDM? Sounds familiar with PIDM? Came across when you walk in to certain bank for your Ringgit? And what is PIDM?

Established in 2005, PIDM, or its full name 'Perbadanan Insurans Deposit Malaysia', is a Government agency that primarily function to protect:

1. Deposit Insurance System (DIS)

- a system established by the Government to protect depositors against the loss of their insured deposits placed with member institutions in the event of a member institution failure.
- in the unlikely event of a member bank fails, depositor's saving in PIDM member banks of up to RM 250,000.00 per institution for per person.

Source: http://www.pidm.gov.my/

2. Takaful and Insurance Benefits Protection System (TIPS)

- a system established by the Government to protect owners of takaful certificates and insurance policies from the loss of their eligible takaful or insurance benefits in the event that an insurer member fails and is unable to honour the takaful or insurance benefits.
- in the unlikely event of an insurer member fails, the owner of takaful certificates and insurance policies of up to RM 500,000.00 is guaranteed by the PIDM.

Source: http://www.pidm.gov.my/

Without the need to apply and without paying any premium fees (YES! It is absolutely FREE!), your hard earned Ringgit is automatically protected by PIDM (of course provided that the institution is a member of PIDM). In other words, you could enjoy these benefits instantly, just be sure that you are aware of the list of PIDM member banks as well as the list of PIDM insurer members.

Apart from that, under Akta PIDM, PIDM is also mandated to provide incentives for sound risk management in the financial system, as well as promote and contribute to the stability of the financial system. Internationally, PIDM is also known as the Malaysia Deposit Insurance Corporation (MDIC).

TIPS:

#1. If your deposited Ringgit in bank (PIDM member bank) has more than RM 250,000.00, you are highly advised to separate and diversify the additional Ringgit into another PIDM member bank. This is for security purpose. As the saying goes, "don't put all your eggs in one basket". As a gentle reminder, be sure that you are aware of the list of PIDM member bank.

#2. In a single PIDM member bank, your deposited Ringgit is inclusive of Savings Account, Current Account, Fixed Deposit, etc. Do find out the eligibility protection of deposits under DIS category.