Information Leaflet – A Deposit Guarantee Scheme Reimburses a Limited Amount to Compensate Account Holders Whose Bank in the UK Has Failed
Deposit Guarantee Scheme UK: The Financial Services Compensation Scheme (FSCS) provides protection for customers of failed financial services firms. The Bank of England collaborates with the FSCS to secure bank deposits to the insured limits, maintain financial stability and protect the public interest. It should not be confused with the Tenancy Deposit Protection (TDP) that regulates security deposits between tenants and their landlords.
Secured Deposit Limit: Customer deposits held by banks, building societies and credit unions (including in Northern Ireland) in UK establishments that are authorized by the PRA are protected by the FSCS up to £85,000.
Additional Insured Coverage: There will be temporary deposit protection for up to 6 months above the £85,000 limit for certain types of deposits classified as temporary high balances, such as the proceeds from private property sales. Protection will be up to £1million in most cases.
FSCS Scheme Architecture: The FSCS is funded by its members. These members are licensed and supervised deposit taking credit institutions that operate in the UK and Northern Ireland. The scheme exclusively applies to its members and compensation is only paid when a DGS claim is eligible under the FSCS rules. Such compensation up to £85,000 for regular bank deposits is paid out when an authorized firm is unable, or likely to be unable, to pay claims made against it.
Claim Filing Procedure: The secure online environment of the FSCS allows creditors from failed banks and building societies to verify whether they are eligible for compensation and file their claim.
Repayment Timeframe: FSCS aims to pay compensation within 7 days of a bank or building society failing. More complex cases will take longer.
Repayment Conditions: Claim eligibility depends on several factors, outlined in the section on depositor protection of the Prudential Regulation Authority Rulebook. Chapter 2.2.4 prohibits FSCS coverage to several types of deposits and account holders. These include but are not limited to deposits arising out of a transaction in connection with which there has been a criminal conviction for money laundering, deposits held by financial and investment firms, and deposits of which the holder and any beneficial owner were not or cannot be identified.
FSCS Claim Rejections: There are three ways to object against a decision of the FSCS to deny DGS compensation. These are appeal, escalation and judicial review.
Need Help To Submit Your DGS Claim or to Substantiate a Rejected DGS Claim? Contact us Today…
- Visit: www.depositguaranteeclaim.com/free-case-evaluation
- Call: 00357 25 057 544 or 001 646 513 2855
- Email: [email protected]
- Complete the contact form below: