Financial Services Compensation Scheme down to £75K.

I don't know if anyone else has noticed this but the Financial Services Compensation Scheme has reduced the level of compensation to £75K.

As many banks have amalgamated it might be worth checking on balances. As I read the scheme, if you have £74K in a bank and it goes belly up you are guaranteed your cash back. If you have £76K in that bank NONE of the balance is guaranteed.

I don't know if anyone else has noticed this but the Financial Services Compensation Scheme has reduced the level of compensation to £75K.

 

As many banks have amalgamated it might be worth checking on balances. As I read the scheme, if you have £74K in a bank and it goes belly up you are guaranteed your cash back. If you have £76K in that bank NONE of the balance is guaranteed.

Yeah it was scaled down a bit about 3 months ago, as ours was higher than the rest of eu, why we brought it down instead of the rest of the eu puutting it up you will have to ask our glorious leaders in Brussels.

Not sure about that 74-76 issue, and quite frankly can't ever see me having that issue

............ As I read the scheme, if you have £74K in a bank and it goes belly up you are guaranteed your cash back. If you have £76K in that bank NONE of the balance is guaranteed.

You are, happily, mistaken.

Your savings up to the limit are protected.

So you can have £90k savings in one bank and still be compensated with £85k (£75k in January).

I have queried this with FSCS and the above is their confirmation.

I don't know if anyone else has noticed this but the Financial Services Compensation Scheme has reduced the level of compensation to £75K.

 

As many banks have amalgamated it might be worth checking on balances. As I read the scheme, if you have £74K in a bank and it goes belly up you are guaranteed your cash back. If you have £76K in that bank NONE of the balance is guaranteed.

Yeah, I got notification of this.

From what I understood the first 75k was covered though, and if it's a joint account it's combined, so it's £150k.

The thing to be wary of is (like the OP said) is amalgamated bank balances. It is important to know who is amalgamated with whom. Only yesterday I was talking to a friend and he didn't know NatWest/RBS are the same bank. I suspect with many smaller banks, we don't know who the parent bank is.

So if I have £75k at NatWest and £75k at RBS, I am only guaranteed £75k as they are deemed one bank under the scheme

Yeah, I got notification of this.

 

From what I understood the first 75k was covered though, and if it's a joint account it's combined, so it's £150k.

yes. i'm not 100% sure. the wording was somethink like accounts with balances of above £75 are unlikely to be covered. i assume the reason for the drop is to stick with the 100K eiros. £75K is about the same as £85K was a decade back.

This is the current wording from my business bank

For bank accounts and deposit based products, Cater Allen is covered by the Financial Services Compensation Scheme (FSCS), with each eligible depositor covered up to £85,000 as a combined amount across his/her Cater Allen accounts, including their share of any joint accounts. Any money held in one of Cater Allen's Structured Deposit Products would also be counted in the £85,000 limit.

It definitely says "up to", it makes no mention of losing cover once you go over.

And HSBC says

On 3 July 2015, the Prudential Regulation Authority announced changes to the compensation limit. For those depositors covered by the FSCS prior to 3rd July, (individuals and small companies) their limit of £85,000 will be maintained until 31 December 2015. After that it will change to £75,000. For those depositors who became eligible for cover by the FSCS from 3rd July onwards, (large corporates) their compensation limit is £75,000 from 3rd July 2015.

Any deposits you hold above the FSCS compensation limit are unlikely to be covered, unless under specific circumstances, as determined by the FSCS.

Balances over the amount aren't covered (as expected), but that doesn't render the balance below the threshold uncovered.

At the current rates of interest available on savings accounts, anyone stupid enough to have anything near to £75k sitting in one deserves to lose some anyway!

At the current rates of interest available on savings accounts, anyone stupid enough to have anything near to £75k sitting in one deserves to lose some anyway!

Don't be ridiculous

I'm heavy into cash waiting for the right opportunity to pick up a cheap asset. There is no point risking it on silly investments. I need liquidity for what I have planned and no point it being stuck in a few thousand rotting BTL bricks.

So if I have £75k at NatWest and £75k at RBS, I am only guaranteed £75k as they are deemed one bank under the scheme

Why does the Government guarantee money in a private bank; I could understand if it was the Bank of England.

Does it apply to building societies?

I assume that they dont guarantee any other types of investments.

Why does the Government guarantee money in a private bank; I could understand if it was the Bank of England.

Does it apply to building societies?

 

I assume that they dont guarantee any other types of investments.

It applies to any institution that is eligible and signed up to the FSCS. Banks, credit unions, building societies etc...

It's totally sensible to guarantee deposits. Otherwise people would not deposit money (not just savings but wages too) into banks as then cash deposits would not be risk free. Then the fundamental basis of our everyday financial transaction system would fail.

Cash deposit is not an investment is it.

It applies to any institution that is eligible and signed up to the FSCS. Banks, credit unions, building societies etc...

 

It's totally sensible to guarantee deposits. Otherwise people would not deposit money (not just savings but wages too) into banks as then cash deposits would not be risk free. Then the fundamental basis of our everyday financial transaction system would fail.

 

Cash deposit is not an investment is it.

So if the banks were allowed to go bust, it would cost the tax payer lots of dosh. So they can gamble as much as they like, with dodgy American loans.

I dont pay cash into my bank.