It has been announced that the limit for compensation in the event of a financial services provider defaulting is to be increased from £75,000 per individual per deposit taking institution to £85,000, £170,000 for joint accounts.
This became effective from 30 January 2017.
This protection is provided in line with EU legislation and the limit is €100,000. With the falling value of sterling, this now equates to £85,000.
No action is required – if you hold deposits with an institution that defaults, you are automatically covered.
However, be aware that a number of high street names may be all covered by the same licence. For example, Alliance & Leicester, Bradford & Bingley and Cahoot are all covered by the licence held by Santander. The Bank of Scotland licence also includes Birmingham Midshires, Halifax, Intelligent Finance and Saga. The Yorkshire Building Society covers the Barnsley Building Society, Chelsea Building Society and Norwich & Peterborough Building Society.
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