The impact of the Jordanian Deposit Guarantee Corporation on depositor confidence and banking stability - An analytical study

Abstract

Deposit guarantee institutions are considered among the most important tools for enhancing confidence in banks and protecting depositors' rights. This paper aims to analyze the role of the Jordanian Deposit Guarantee Corporation (JODIC) in boosting depositor confidence and increasing the volume of bank deposits, thereby supporting the stability of the banking sector in Jordan.

This study seeks to analyze the role of the Jordanian Deposit Guarantee Corporation in enhancing depositor confidence and increasing deposit volumes, addressing the core research problem: the need to measure the institution's actual impact on banking sector stability. The study adopted a descriptive-analytical approach, conducting a survey of a sample of employees in the banking sector.

The results revealed a strong positive relationship between the Corporation's activities and an increased level of banking confidence, demonstrating that its presence explains a sizable portion of the variation in depositor trust levels. Based on these direct findings, the study puts forward key recommendations: increasing awareness of the Corporation's role among depositors and periodically reviewing the guaranteed compensation ceiling to align with the requirements of banking stability.