Deposit Insurance around the World and the Turkey Experience

A deposit insurance scheme has the specific aims to protect small depositors and to contribute to the stability of financial system. The number of countries that have a deposit insurance scheme have increased rapidly since 1980. Turkey establishing explicit insurance scheme has experienced serious banking crises and the state had to go on domestic borrowing to pay this cost including deposit payments. The paper examines deposit insurance systems in theory and practice in the world; gives wide coverage to the Turkey’s model and make recommendations.