Deposit guarantee insurance is being considered in China due to recent bank failures. This system aims to prevent bank runs and restore depositor confidence. However, introducing this scheme in China may pose unique challenges, such as moral hazards for financial institutions and neglect by depositors. The experiences in the USA and Europe show that while deposit insurance can be beneficial, it can also create problems. Given that major Chinese banks are state-owned, implementing risk-dependent contributions may not be suitable for China.