Q&As about Deposits


  1. What happens if I am a member of a credit union that fails?

  2. How long will it take to process my claim?

  3. If I have more than £85,000 in an account, does that mean I will lose money?

  4. What is the position for people who have multiple accounts with banks that are subsidiaries of another bank?

  5. I have my money in a joint account in a High Street bank. How would FSCS pay compensation if the bank failed?

  6. What happens if I owe money to a bank, building society or credit union that fails?

  7. Will you compensate me for any interest I have earned on my account?

  8. Are offshore deposits covered?

  9. Does the Scheme cover deposits made in different currencies?

  10. Are deposits held by nominee companies covered?

  11. Do you cover deposits made through solicitors and other professionals?

  12. Is a business covered if the bank or building society it holds money with fails?

  13. Are pre-paid cards covered by the FSCS?


  1. What happens if I am a member of a credit union that fails?

    You do not need to do anything and will not need to lift a finger. FSCS will automatically pay you back your savings according to the account information it receives from your credit union. You will receive your payment through the post within 7 days of the credit union being declared in default.

    People with less than £1,000 will receive a letter to get cash over the counter at the Post Office. Please note that the letter you receive will be in an unmarked envelope and will not have FSCS details on it. Anyone with more than £1,000 will receive a cheque. This will also be sent to you in an unmarked envelope.

    Return to top

  2. How long will it take to process my claim?

    The length of time a claim takes to process will depend upon a number of factors, like the type and complexity of a claim, and the level of information we need to gather from other sources. Some of these factors may be entirely outside our control, but we are still able to provide general guidelines for each claim type. However, we aim to pay compensation in the vast majority of cases within seven days of the failure of the company. We aim to pay the remaining claims, which are likely to be more complex, within 20 working days.

    Return to top

  3. If I have more than £85,000 in an account, does that mean I will lose money?

    A depositor whose total deposits with a failed bank exceed the compensation limit will receive compensation for the amount of their deposit up to the limit of £85,000.

    All claims will be paid out in UK Pounds Sterling.

    Depositors with deposits above the limit may also receive additional funds in the form of a share of their savings following any distribution of assets as part of the insolvency process for their firm. How much they receive depends on the rate of recoveries (also known as the dividend rate) in the liquidation of the company.

    The liquidation process can take a long time to complete. Depositors will have to wait until the liquidator has completed the process to find out how much more they might receive in total. There is no certainty that they will receive any further payments. This process is separate from the FSCS compensation process.

    Related information

    Return to top

  4. What is the position for people who have multiple accounts with banks that are subsidiaries of another bank?

    For people who hold multiple accounts in banks that are part of a larger group, if each of the banks is separately authorised by the Financial Conduct Authority:

    If each of the banks is covered by a single authorisation:

    • FSCS would pay compensation up to the limit of £85,000 once, irrespective of how many different institutions a person held accounts with.

    All claims will be paid out in UK Pounds Sterling.

    If you have a question about how a bank or building society is authorised, please contact the Financial Conduct Authority Consumer Contact Centre on 0800 111 6768

    Return to top

  5. I have my money in a joint account in a High Street bank. How would FSCS pay compensation if the bank failed?

    The compensation limit of £85,000 applies to each depositor for the total of their deposits with an organisation, regardless of how many accounts they hold or whether they are a single or joint account holder. In the case of a joint account, FSCS will assume that the money in that account is split equally between account holders, unless evidence shows otherwise. This applies even if you have recently split up with your partner.

    This means that each account holder in a joint account would be eligible for compensation up to the maximum limit.

    All claims will be paid out in UK Pounds Sterling.

    Return to top

  6. What happens if I owe money to a bank, building society or credit union that fails?

    In the event that your bank, building society or credit union fails, you are obliged to continue making repayments in accordance with the terms and conditions of your mortgage, loan, etc. Further information about how to make repayments will be available from the administrator of your bank / building society / credit union.

    The FSCS will only consider accounts that have a credit balance for compensation.

    Return to top

  7. Will you compensate me for any interest I have earned on my account?

    When the the bank is declared in default by the FSCS, you (the depositor) will be paid any interest owed as part of your compensation amount.

    All claims will be paid out in UK Pounds Sterling.

    Return to top

  8. Are offshore deposits covered?

    We do not cover deposits outside the European Economic Area (EEA), or in the Channel Islands or Isle of Man.

    Return to top

  9. Does the Scheme cover deposits made in different currencies?

    Yes, however all claims will be paid out in UK Pounds Sterling.

    Return to top

  10. Are deposits held by nominee companies covered?

    We cover deposits held in client accounts, for example by solicitors, and may cover deposits held by nominee companies. FSCS does not protect non-nominative deposits.

    Return to top

  11. Do you cover deposits made through solicitors and other professionals?

    We generally cover client account arrangements (such as pooled accounts), which may be set up by solicitors, stockbrokers, landlords or other professionals, provided the deposit-taker (e.g. bank or building society) is authorised to accept deposits, which would normally be the case. The identities of the underlying clients and details of their respective entitlements to the deposit monies can be provided to the FSCS at the time a claim is made.

    The Law Society has its own compensation scheme for its members' investment business, that only applies in the case of dishonesty of a solicitor. In those circumstances claims against solicitors in England and Wales should be referred to it. Claims against solicitors in Scotland should be referred to The Law Society of Scotland.

    However, if the solicitor is holding your money in a client account with an authorised deposit-taker that fails, then your claim is against the deposit-taker and you should ask us to deal with it. The Law Society provides further guidance on this.

    Claims against some other professionals can be made to us, but only if the claim arises on or after 1 December 2001. If your claim is for activities before this date, look at our Claiming compensation booklet for details of the organisations to contact.

    Further guidance for landlords, managing agents, resident management companies and others charged with the collection of service charge monies.

    Return to top

  12. Is a business covered if the bank or building society it holds money with fails?

    FSCS was set up mainly to assist private individuals, although some smaller businesses are also covered. Larger businesses are generally excluded, although there are some exceptions to this (for example for claims in respect of certain compulsory insurances). Our rules tell us which claims are eligible and form part of the PRA's Handbook, under Redress, Compensation.

    As an indicative guide only, for the purposes of deposit and investment claims, smaller companies are protected. A smaller company must meet two of the following criteria (as set out in section 247 of the Companies Act 1985 or section 382 of the Companies Act 2006 as applicable):

    • Turnover: not more than £6.5 million

    • Balance sheet total: not more than £3.26 million

    • Total number of employees: not more than 50

    For claims made under an insurance contract, small businesses are protected. A small business under the COMP rules is one that has an annual turnover of less than £1m.

    The same levels of compensation apply whether the claimant is a private individual, small business, or a small company.

    Return to top

  13. Are pre-paid cards covered by the FSCS?

    The FSCS does not protect e-money which could include money on pre-paid cards. This is because e-money does not satisfy the definition of a “deposit” and so is not within the scope of FSCS protection. E-money is covered by the Payment Services Directive which explains the protection given to users of e-money.

    Return to top