How FSCS protection works

What it is

The Financial Services Compensation Scheme is the UK's statutory safety net. If an authorised bank, building society or credit union fails, the FSCS compensates eligible depositors up to the protection limit — automatically, without you needing to claim, and typically within days for straightforward deposit accounts.

You do not apply and you are not charged. What is worth doing is checking that the firm holding your money is actually authorised, using the FCA Register or the FSCS's own protection checker.

The limit

£85,000 per eligible person, per authorised firm.

For a joint account, each holder has their own limit, so a joint account is protected up to £170,000.

Licences, not brands

This is the part that catches people out, and it is the single most useful thing on this page.

FSCS protection attaches to the authorised firm — the entity holding the banking licence — not to the customer-facing brand. Several well-known high-street names operate under a shared licence with other names in the same group.

If you hold £60,000 with one brand and £50,000 with another, and both operate under the same licence, you are protected for £85,000 in total, not £110,000. The remaining £25,000 has no protection.

To hold more than £85,000 with protection, spread it across separately licensed institutions.

Temporary high balances

Certain life events leave people holding far more than usual for a short period — selling a property, receiving an inheritance, a redundancy payment, an insurance settlement, a divorce settlement.

The FSCS provides additional protection for these temporary high balances, above the normal limit, for a limited window of six months from when the money is credited. The qualifying events and the cap are set out by the FSCS, and the protection is not automatic in the same way the £85,000 is — check the FSCS's own page on temporary high balances if this applies to you.

What is covered

• Current accounts
• Savings accounts
• Cash ISAs
• Fixed-rate bonds and notice accounts
• Deposits with credit unions

What is not deposit protection

• Investments — stocks, funds, bonds. There is FSCS cover for investment business, but under a separate limit and different rules. It protects against the firm failing, never against your investment falling in value.
• Money held with a firm that is not authorised. This includes some e-money and payment institutions.
• Cryptoassets. No FSCS protection.
• Deposits with non-UK-authorised institutions, which may be covered by another country's scheme instead — or by none.

If your provider fails

You do not need to do anything for a straightforward deposit account. The FSCS aims to pay eligible depositors automatically within days, usually by transferring the balance to another account or sending a cheque.

More complex cases — trusts, temporary high balances, business accounts — may require a claim. The FSCS is free to use, and no one needs to be paid to make a claim on your behalf.