Protection of deposits and investments
The UK Financial Services Compensation Scheme (FSCS) may offer protection if a client suffers financial loss as a direct consequence of a UK financial institution being unable to meet any of its liabilities. Payments to eligible claimants under the FSCS will vary depending on the type of protected claim (for example, a deposit or investment) that the claimant has.
Claims in respect of protected investment business and mortgage advice are currently limited to 100% of the first £50,000.
Compensation payments to eligible depositors under the FSCS are limited to 100% of the protected deposits up to a maximum of £85,000.
For joint accounts, each individual account holder is eligible to claim up to the relevant FSCS limit.
Some types of claimants and accounts are not covered by the FSCS. While the determination of eligibility for compensation ultimately lies with the FSCS, the main exceptions to the FSCS's coverage are as follows:
- Where client money is deposited with overseas banks or building societies, or as fiduciary deposits, as part of our Cash Management Service;
- Claims by financial institutions, collective investment schemes, local authorities, occupational pension schemes and similar bodies.
Note that the above financial criteria may be amended by the government from time to time. Further guidance on eligibility, including how the rules apply to charity clients, is available from the FSCS’s website at: www.fscs.org.uk/what-we-cover.
A detailed description of the Financial Services Compensation Scheme (including information on how to make a claim, eligibility criteria and the procedures involved) is available from the Financial Services Compensation Scheme who can be contacted at 10th Floor Beaufort House, 15 St Botolph Street, London, EC3A 7QU or via their website at www.fscs.org.uk.