Notes for editors

About FSCS

FSCS is the UK's financial compensation scheme that protects customers of authorised financial services firms if they fail or have stopped trading. FSCS protects:

  • Banks, building societies and credit unions
  • Debt management
  • Endowments
  • Mortgage advice
  • Insurance
  • Investments
  • Pensions
  • PPI
  • Funeral plans

FSCS can pay compensation if an authorised firm fails and is unable to pay back money it owes its customers. FSCS is independent and was set up by parliament in 2001. It’s completely free to use and is funded by the financial services industry.   

Declaring a firm in default

Before FSCS can pay compensation, it must be satisfied that an authorised financial services firm is not in a financial position to meet claims against it (e.g. if the firm has failed and entered an insolvency process such as administration or liquidation). FSCS describes this as being ‘in default'. The Scheme will declare a firm in default if:

• it has received at least one claim; and
• it is satisfied that the firm is unable to return money to eligible customers itself.

FSCS is required to do this before it can pay compensation to eligible customers.

Declaring a firm in default allows private individuals who have suffered actual financial loss as a result of their dealings with that firm to apply to the Scheme. Some businesses and charities may also be eligible, depending on the type of claim.

Authorised firms

To be able to claim compensation with FSCS, the failed firm in question must have been regulated by the Financial Conduct Authority (FCA) or the Prudential Regulation Authority. Consumers can check that the firm they are dealing with is regulated by using the FCA’s financial services register.

Broadcast media

An ISDN line is available if you’re interested in arranging a radio interview with an FSCS spokesperson. Please get in touch with our public relations team at to arrange a suitable time and date.

View our compensation limits.