FSCS protection for your savings

The Financial Services Compensation Scheme (FSCS) protects your savings when financial firms fail.

It’s a free service that anyone in the UK can access if an authorised financial organisation goes out of business and you are at risk of losing your money.

There is a limit to how much savings protection you could receive. We’ll explore the FSCS, its compensation limits, and how it protects your savings below.

If a financial services firm goes out of business and cannot return your money, you can claim for lost savings up to £120,000 per person, per authorised institution with the Financial Services Compensation Scheme. In most cases, the FSCS aims to return your protected savings up to the compensation limit within seven working days.

It’s a free, independent service in the UK funded by the financial services industry. The scheme only applies to funds saved within an authorised financial institution.

A bank or financial services firm must have a banking licence to operate. A firm or a financial institution can operate multiple brands under the same licence, meaning the £120,000 protection limit applies per authorised institution, not per account. 

As a result, if your money is divided over multiple bank accounts across organisations that share the same banking licence you will only be protected up to a total of £120,000. For example, if you have £60,000 saved with one bank and £70,000 with another — but the same financial group owns both banks — your funds would only be protected up to a total of £120,000. This example scenario would leave £10,000 unprotected.  

To find out which banks share a licence and if your bank trades under any other names, visit the Financial Conduct Authority’s Financial Services Register.

It’s also worth noting that some banks that provide savings accounts are not regulated in the UK. With these banks, your money would not be protected under the scheme.

You may also be eligible for protection of temporary high balances. This would include money from a property sale, redundancy payments, and inheritance. In these circumstances, you could be covered up to £1,400,000.

The scheme also covers other financial services. For example, if your insurance company goes out of business, the FSCS may pay for protected claims. Or, if your pension provider has to close their business, you may be protected (so long as the Financial Conduct Authority regulates the pension).

At Shawbrook, your eligible savings are covered by the Financial Services Compensation Scheme up to £120,000 per person across all your Shawbrook accounts (including Whiteaway Laidlaw accounts). Shawbrook Bank is authorised by the Prudential Regulation Authority, and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Financial Services Register number: 204574).

For more information, on how the scheme works and what is covered, you can view the FSCS leaflet, the FSCS Information sheet, or visit the Financial Services Compensation Scheme website.

In some cases, your money would not be covered by the FSCS. For example, the scheme does not cover claims against companies still in business. You would also not be covered if the organisation is not a firm authorised to receive FSCS protection. 

Before you open a savings account, it's important to check whether the bank is covered by the FSCS, so that your deposits are protected up to £120,000.

Remember, your eligible deposits with an authorised firm are covered up to the compensation limit. If you have savings over the threshold, you should consider opening other savings accounts with a different bank or building society, providing they have individual banking licences.