Hong Kong enhances Deposit Protection Scheme

It raises the protection limit from $500,000 to $800,000.

The Legislative Council has passed an amendment bill to strengthen the Deposit Protection Scheme (DPS).

Effective 1 October, the amendment increases depositor protection from $500,000 to $800,000. These changes, part of the Deposit Protection Scheme (Amendment) Ordinance 2024, also refine the levy system to ensure the DPS Fund grows adequately alongside the higher protection limit.

Additionally, the amended ordinance enhances coverage for depositors during bank mergers or acquisitions, providing increased security and stability. It mandates the display of DPS membership on electronic banking platforms of DPS members and streamlines disclosure requirements for non-protected deposit transactions for private banking customers. 

Financial Services and the Treasury Secretray Christopher Hui said these amendments are pivotal in boosting depositor confidence and reinforcing the banking sector's resilience.

The amended ordinance will be gazetted on 12 July 12, 2024, and implemented in two phases. Phase one, starting 1 October, will see immediate enforcement of measures requiring minimal preparatory work such as the increased protection limit. Meanwhile, phase two, effective 1 January, will focus on additional operational measures.