The deposit insurance system as a mechanism for enhancing financial stability and protecting depositors: An analytical study of the Algerian experience

Hamlil Abdelhak; Hamlil Bachir

doi:10.55094/hoec.3144

Authors

Hamlil Abdelhak Abou Bekr Belkaid University / Algeria 0009-0009-7847-7419
Hamlil Bachir Djillali Liabès University / Algeria 0000-0003-3131-7273

10.55094/hoec.3144

Abstract

Purpose: This study aims to examine the deposit insurance system as a key mechanism for enhancing financial stability and protecting depositors, with a specific focus on the Algerian experience. It addresses the problem of declining public confidence in the banking sector in the absence of effective depositor protection frameworks. Method: The study adopts an analytical and descriptive approach by examining the legal and institutional framework governing deposit insurance in Algeria. It analyzes relevant legislation, particularly Monetary and Banking Law No. 23-09 and related regulations, and compares them with international practices. Findings: The findings indicate that the Algerian deposit insurance system plays a significant role in strengthening public trust, preventing bank runs, and supporting financial stability. However, certain structural and legal limitations exist, including constraints related to compensation ceilings, institutional design, and coordination with supervisory authorities. Conclusion/Contribution: The study contributes by providing a comprehensive evaluation of the Algerian deposit insurance system and highlighting areas for improvement. It emphasizes the need for continuous regulatory updates, enhanced institutional coordination, and adaptive policy measures to ensure long-term financial stability and effective depositor protection.

Keywords:

Deposit Insurance Banking Stability Deposit Guarantee Fund Financial Regulation Algeria

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