The Corporation is mandated to provide a deposit insurance scheme for customers of member institutions, to provide incentives for sound risk management and generally promote the stability of the financial system and prompt resolution.
The KDI Act, 2012, mandates the Central Bank of Kenya, to appoint KDIC as the sole and exclusive receiver of a member institution when (a) the institution's obligations to creditors exceed its assets (b) deliberately violates a regulatory or supervisory order (c) fails to provide necessary access to inspectors or lacks general transparency (d) is unable to meet any of its financial obligations, either now or in the near future (e) engages in activities that violate any of the country's laws.
It also collects an additional fee based on the risk-adjusted percentage of their total deposit liabilities during the previous twelve months as calculated by KDIC.
[1] In June 2016, CBK mandated KDIC to intervene, when member financial institutions fell foul of Kenya's banking laws and regulations, during the previous twelve months.
KDIC's headquarters are located at Old Mutual Tower, Upper Hill, Nairobi.