Nominated MP Johnson Sakaja met the KDIC on Tuesday for consultations on how to protect depositors from collapsing banks.
Sakaja held discussions with CEO Jonathan Bett, Mohamud Mohamud (Head of Risk), Jane Ikunyua (Head of Legal) and Walter Onyino (Head of ICT).
The meeting discussed ways of protecting depositors and consulted on an amendment Bill that Sakaja has sponsored in Parliament.
The TNA chairman has proposed to amend the Kenya Deposit Insurance Act to give depositors more money when banks collapse.
The amendment seeks to increase the protection limit from the maximum of Sh100,000 set in 1985 to Sh2 million.
"As currently set, the maximum amount of Sh100,000 does not offer fair compensation to a significant portion of depositors..." Sakaja explains in the Bill's memorandum of objects and reasons.
"[This is]
especially young people and small and medium size enterprises likely to be victims of the banking collapse."
Sakaja also wants the principle Act amended to ensure each account held by a depositor is covered by the insurance.
"Where a depositor owns more than one deposit account with an institution, each of the accounts shall be insured to the prevailing maximum fixed under subsection (1)," states the amendment to Section 28 of the Act.
The Act states that where a depositor has more than a single account, all their deposits are aggregated and insured as one.
Three banks have been put under receivership in the last two years - Dubai Bank, Imperial Bank, and Chase Bank - resulting in deposits being withheld.
Dubai and Imperial's depositors were only able to get Sh100,000 of their money while Chase Bank is set for on Wednesday.