The Research On Explicit Deposit Insurance Legal System Of China

With the rapid development of the global economy and finance inthe20th century, the global financial crisis occurs frequently, causingincalculable damage to the social and economic development. As a result,many countries have established a financial safety net to maintain socialand economic stability. Deposit insurance system, as an importantcomponent of the financial safety net, plays a significant role inprotecting the interests of depositors and maintaining financial stability.For a long time, China has adopted an implicit deposit insurance systemwhich facilitates financial stability to some extent. However, with thefurther deepening of China’s financial system reform, it cannot satisfy theneeds of financial development any longer. Instead, the establishment ofexplicit deposit insurance system has become increasingly urgent andimportant.This paper first discusses and summarizes the drawbacks of theimplicit deposit insurance system from its history and currentdevelopment, followed by a description of the experience of othercountries’ implementation of explicit deposit insurance system and a summarization of the relevant laws and regulations of deposit insurancesystem of our country. The related content that the deposit insurance lawshould be equipped with in China is then pointed out from such aspects asthe establishment of a deposit insurance agency, functions and authorities,premium rate and supporting legal protection. The paper concludes withproblems existed in the transition process from the implicit to explicitdeposit insurance system in the light of the current status of China’sfinancial system. Laws and regulations which are needed to protect thetransition process are also explored in the present study based on theproblems proposed above.The establishment of a suitable explicit deposit insurance systemstill has a long way to go in China. During the transition process of thesystem from implicit to explicit, in particular, it needs to adjust to thechanging circumstances constantly.