The government has doubled the maximum deposit insurance payout to KRW100m ($71,400) from 1 September 2025, against the KRW50m limit set in 2001.
The Korean deposit insurance scheme guarantees that if a bank or other deposit-taking institution fails, depositors will still recover their money up to a certain limit. Over the years, financial authorities had taken a cautious stance on raising the deposit payout ceiling, but with significant economic growth and hike in depositor assets, the need to raise the ceiling was felt.
The ceiling will be raised for financial institutions such as banks and savings banks covered by the state-run deposit insurance agency, the Korea Deposit Insurance Corporation. It also covers credit unions, agricultural cooperatives, fisheries cooperatives, forestry cooperatives and community credit cooperatives, where deposits are protected by their respective organisations. In other words, once the amendment takes effect, if a financial institution or mutual finance cooperative is unable to pay out deposits due to bankruptcy or other reasons, depositors will be protected for up to KRW100m.
In addition, the same KRW100m limit will apply separately to retirement pensions, including defined contribution plans and individual retirement pensions (IRPs), as well as pension savings accounts and certain insurance payouts provided by mutual finance institutions.
This means that coverage will be separately applied by category within the same financial institution or cooperative. For example, a depositor with KRW100m in a savings account and another KRW100m in an IRP at the same bank would be insured for both amounts, effectively doubling the level of protection.