Malawians Urged to Save Money in Banks for Safety
The Deposit Insurance Corporation (DIC) has launched a renewed push to reassure Malawians that their money is safe in banks, amid continuing public hesitation to fully embrace formal financial institutions in a country where cash outside the banking system remains widespread.
The corporation is urging citizens to keep their savings in regulated banks, stressing that deposits are protected in the event of bank failure or closure — a safeguard many Malawians remain largely unaware of or skeptical about.
However, the latest figures reveal a deeper structural concern: despite a population of over 20 million people, only about 2.7 million Malawians hold bank accounts, exposing a wide financial inclusion gap and raising questions about trust, access, and confidence in the formal banking system.
Speaking in Lilongwe during a media engagement with members of the Association of Business Journalists, Lowina Mwasigala, Manager of Operations at the Deposit Insurance Corporation, said the scheme was designed to protect depositors in all commercial banks licensed and regulated by the Registrar of Financial Institutions.
She said the DIC exists specifically to prevent panic withdrawals and financial instability by guaranteeing compensation to depositors in the unlikely event of a bank collapse.
Mwasigala further disclosed that the corporation has so far accumulated K20 billion into the deposit insurance fund, but noted that the target stands at K174 billion, a gap that highlights the scale of financial preparedness still required to fully secure the system.
The shortfall raises underlying concerns about whether the fund is sufficiently capitalised to withstand a major banking shock in a fragile economic environment.
Despite these assurances, financial experts and stakeholders continue to point to a persistent culture of cash dependency, with many Malawians preferring to store money at home or operate outside the banking system due to fears of charges, limited financial literacy, and distrust in formal institutions.
On his part, Alex Banda, Deputy National Coordinator of the Association of Business Journalists, said the DIC’s message should be strengthened and widely communicated to shift public behaviour towards formal banking channels.
He said Malawians must be encouraged to trust regulated financial institutions in order to protect themselves from risks such as theft, loss, and the dangers of keeping large sums of cash outside the banking system.
Banda also emphasized that both government and citizens have a role to play in promoting financial inclusion, arguing that policy support alone is not enough unless accompanied by sustained public education and confidence-building measures.
He warned that continued reluctance to use banks undermines economic formalisation efforts and limits the country’s ability to expand financial security and investment participation.
The developments highlight a persistent paradox in Malawi’s financial system: while regulatory safeguards such as deposit insurance exist on paper, public trust and awareness remain significantly low, leaving much of the population still operating on the margins of the formal banking sector.
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