Deposit Insurance Corporations

This entry examines the evolution and functions of the Islamic deposit insurance corporations, particularly within an Islamic finance setting. Given that they are novel additions to the existing financial and economic systems in most of the times, the Islamic financial and economic institutions often suffer from lack of credibility, a problem which they address from a wide array of perspectives. In an attempt to improve their popularity and promote their image, Islamic finance institutions introduce additional mechanisms and guarantees which also include deposit insurance tools. These institutions offer guarantees for the investors and the depositors and have been made part of the regular banking and financial system in some of the Muslim countries.