The Nigeria Deposit Insurance Corporation (NDIC) has issued a strong warning to Nigerians to stay away from Ponzi schemes and fraudulent investment platforms that promise unrealistic profits but often collapse and leave participants with heavy financial losses. The warning was delivered by the NDIC Managing Director, Mr. Thomson Sunday, during the NDIC Special Day at the 46th Kano International Trade Fair on Wednesday.
Speaking through Mr. Kayode Shokunbi, Deputy Director in the Procurement Management Services Department, the NDIC boss emphasised that Nigerians must take responsibility for protecting their hard-earned savings by dealing only with legitimate financial institutions licensed by the Central Bank of Nigeria (CBN) and covered by NDIC deposit insurance.
Ponzi schemes have continued to trap thousands of Nigerians despite repeated warnings from regulators. These schemes usually promise very high returns within short periods. However, they typically operate without registration, lack transparency, and use money from new investors to pay earlier investors. Once the flow of new deposits stops, the schemes collapse, leaving participants stranded and unable to recover their funds.
Over the past decade, schemes such as MMM, Loom, and similar digital platforms have caused huge financial losses across states, wiping out the savings of students, traders, civil servants, and retirees. Many of these schemes resurface under new names, especially during periods of economic hardship when people are desperate for extra income.
The NDIC says protecting consumers from such schemes requires public awareness and personal vigilance.
Mr. Sunday said Nigerians must remain alert and avoid placing their money in unverified hands. He urged the public to interact with NDIC officials at the trade fair to learn more about how deposit insurance works and to ask questions about identifying safe and unsafe financial institutions.
“Your vigilance is crucial to safeguarding your hard-earned savings,” he said. “I urge you to remain vigilant and visit the NDIC Pavilion during this Trade Fair. Our team is ready to provide insights, answer questions, and share information on deposit insurance and our activities.”
He further encouraged Nigerians to stay informed about the status of their banks and to confirm that any deposit-taking institution they use is fully licensed by the CBN and insured by the NDIC.
The NDIC Managing Director also emphasised that bank customers must ensure their Bank Verification Numbers (BVN) match their names exactly as stated on all official identity documents. Any mismatch, he said, could cause delays in accessing insured funds if a bank fails.
“I would like to emphasize the importance of linking your Bank Verification Number with your correct name as stated in all official identity documents,” he said.
He explained that having correct BVN details ensures that, in the event of a bank failure, depositors will receive their insured sums promptly and automatically.
Under NDIC guidelines, depositors of commercial banks and mobile money operators are insured up to N5 million, while customers of microfinance banks, primary mortgage banks, and payment service banks are insured up to N2 million. According to Sunday, these payments can be made into an alternate bank account with matching identification details without requiring the depositor to visit an NDIC office.
The NDIC reassured Nigerians that the corporation, alongside the CBN, has strengthened regulatory frameworks for all deposit-taking institutions to ensure compliance, transparency, and stability in the financial system. He said this has become especially important as financial technology continues to evolve, creating new opportunities and risks.
“With the rapid growth of financial technology, traditional banks still play a vital role in the banking system,” Sunday said.
He noted that fintech companies have helped expand financial access, but Nigerians must still be cautious because many unlicensed digital wallets and investment apps operate outside regulatory oversight.
Speaking on the ongoing recapitalization of banks, which has a deadline of March 2026, Sunday said the NDIC is fully prepared for the process and will ensure it is carried out smoothly. He added that regulatory interventions would be made if necessary to preserve confidence in the financial system.
According to him, the recapitalization exercise is part of a wider effort by the government and financial regulators to build stronger, more resilient banks capable of supporting economic growth and protecting depositors.
“The NDIC remains committed to ensuring the stability and security of financial institutions in Nigeria,” Sunday said.
The NDIC boss highlighted the corporation’s long history of safeguarding depositors’ funds, especially for vulnerable populations such as low-income earners and small business owners. He said that for the past 37 years, the NDIC has played a vital role in preventing bank runs, resolving failed banks, compensating depositors, and maintaining public confidence in Nigeria’s financial sector.
He said deposit insurance remains one of the strongest tools for promoting financial stability, especially in a developing economy where many citizens rely heavily on savings for emergency needs, school fees, and business capital.
Sunday also praised the organizers of the 46th Kano International Trade Fair, describing it as an important platform for promoting entrepreneurship, financial literacy, and economic growth. The fair’s theme, “Empowering SMEs for Sustainable Development,” highlights the need for stronger support systems for small and medium-sized enterprises (SMEs), which make up more than 80 percent of Nigeria’s businesses.
He explained that trade fairs help bring together innovators, investors, manufacturers, and regulators in ways that encourage investment and strengthen the economy. The NDIC, he said, uses such events to educate the public on how deposit insurance works and how the corporation protects people’s savings.
“These platforms remain instrumental in strengthening entrepreneurship, promoting financial literacy, and supporting Nigeria’s development objectives,” he said.
The NDIC’s warning comes at a time when many Nigerians are turning to alternative investment platforms due to rising inflation, high cost of living, and declining job opportunities. The desperation for quick financial returns has made some citizens easy targets for scammers operating online and offline.
