Abstract and Keywords
This article briefly discusses the objectives of deposit insurance and states how it should function in non-crisis situations. It also analyzes evidence on how well various deposit insurance systems have functioned, and notes critical conceptual weaknesses in the design of typical systems that have been recently put in place. Finally, the article proposes key features that any well-functioning and efficient guarantee system should have if it is to be an effective part of a country's broader financial safety net system in non-crisis periods.
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