The financial crisis of 2008 has revealed important shortcomings in financial supervision. The European competent authorities and bodies had therefore decided to move to radical reform of the regulatory and the supervisory framework and therefore adopt the rules of the ‘single rulebook’. The creation of the European Banking Union was the response to the Eurozone crisis. The EBU’s two pillars, i.e. the Single Supervisory Mechanism (SSM) and the Single Resolution Mechanism complement each other and aim to monitor the implementation of the single rulebook by the banks and to be responsible for their resolution, if needed, accordingly. In this context, the Commission through its comprehensive package of reforms in November 2016, aimed to establish same level of protection for all depositors within the Banking Union. For this purpose, the creation of a Single European Deposit Insurance Scheme (EDIS) is deemed to be necessary. The purpose of this thesis is to present the so called ‘third pillar’ of the European Banking Union and the reasons the creation of the EDIS is of such importance highlighting its structure and the transition from the previous deposit insurance framework to the one to be implemented under the Commission’s proposal.