Deposit Protection Scheme

Personal finance

The Deposit Protection Scheme (DPS) was introduced in Hong Kong in 2006 under the Deposit Protection Scheme Ordinance to protect depositors by paying them compensation in the event of the failure of a bank which is a member of the Scheme. As a depositor, be it personal or corporate, you are entitled to be compensated up to a maximum of HK$500,000 (with effect from 1 October 2024, the protection limit will be increased to HK$800,000).

All licensed banks in Hong Kong, unless exempted, are members of the Scheme. Deposits held with restricted licence banks and deposit-taking companies, however, are not protected by the Scheme.

Most of the commonly placed deposits with Scheme members, whether denominated in Hong Kong dollar, renminbi or any other currency, qualify for this protection. These include current accounts, savings accounts, secured deposits and time deposits with maturity not exceeding five years.

Type of deposits which are not protected by the DPS includes:

  • structured deposits
  • time deposits longer than 5 years in maturity
  • bearer form deposits such as bearer certificates of deposit,
  • off-shore deposits
  • deposits held for the account of the Exchange Fund
  • deposits held by an excluded person. Examples of excluded persons include a related company of the Scheme member, a multilateral development bank, licensed banks, restricted licence banks, deposit-taking companies, a foreign bank, senior management, controllers and directors of the Scheme member and its related companies, etc.

Generally speaking, your bank will notify you if your deposits are protected. You don't have to apply beforehand for protection, although you may be asked to provide information to support your entitlement of compensation.