Business accounts protection under FSCS??

I,_Brian

Quick question - are business bank accounts protected by the FSCS?

If so, do they only have the £50k limit of protection?

Or do a separate set of rules apply for business bank accounts in terms of protection of deposits?

dunstonh

No change in the situation from the last dozen or so times it was asked in the last few days.

small businesses get deposit protection. Large businesses do not.

I,_Brian

Thanks for the reply - I used the search feature and went through 10 pages of threads and couldn't find anything on this exact subject I'm afraid.

Astonishing to think that when Robert Peston claimed HBOS nearly collapsed last week and yet business cash is only protected to the level of ordinary consumer, despite the fact they are likely to have more liquidity? (Or is that an erroneous assumption?)

Reaper

I've now added the question to the FAQ

I,_Brian

Many thanks for that, Reaper.

silvercar

dunstonh wrote: »

No change in the situation from the last dozen or so times it was asked in the last few days.

small businesses get deposit protection. Large businesses do not.

Are businesses with a turnover between £1m and £2m protected?

AJBIRD30

Are there any other small business out there like us that are today finding it hard to find out exactly what is happening and whether our money is safe, We have about £150k in account with Singer & Friedlander (Isle of man) not profit this money is needed to pay people/suppliers. The UK FSA say Isle of Man is not covered by them under the UK protection scheme, The Isle of Man FSA say they do have scheme for small business to claim 75% of there savings upto a limit of £15k (which is nothing) but today say they are holding a meeting and may cancel that completly and not have any cover for small businesses.
It seems unfair that so many small companies out there may now have to close because of this and through no fault of there own resulting in many job losses, also small businesses should have the same right as single investers at least so we can try and get at £50k back. If any other small business out there are also asking questions today or if anyone has any answers please let us know.

johnllew

silvercar wrote: »

Are businesses with a turnover between £1m and £2m protected?

Yes, depending on one other factor (for limited companies):

I run a small business, what about me?

The deposit protection scheme was set up primarily for private individuals, the FSCS says. But small businesses get similar protection to savers if the limited company can satisfy at least two of the following three criteria:

• A turnover of not more than £6.5m
• A balance sheet total of not more than £3.26m
• A total number of employees of not more than 50.

Partnerships - not the individual partners - could claim up to £50,000. For a sole trader account, the sole trader could claim up to £50,000 in total, but can only claim for either personal or business accounts with each institution - they cannot claim for both.

http://news.bbc.co.uk/1/hi/business/7482914.stm

dunstonh

The UK FSA say Isle of Man is not covered by them under the UK protection scheme

Correct. Isle of Man is not regulated by the FSA and Isle of Man based firms do not pay towards the FSCS protection scheme.

It seems unfair that so many small companies out there may now have to close because of this and through no fault of there own resulting in many job losses,

Whilst I sympathise, what was the company accountant doing with regards to due dilligence and research that led to putting so much money into such an account?

also small businesses should have the same right as single investers at least so we can try and get at £50k back. If any other small business out there are also asking questions today or if anyone has any answers please let us know

savers in non FSA authorised regions of the world dont have a £50k protection. The protection doesnt come from the Govt. it comes from the FSCS. That is funded by FSA authorised firms (although the Govt lends money to the FSCS to meet liabilities which FSA authorised firms then have to pay back). If you place business in any non FSA authorised firm then you increase the risk (unless the alternative has better protection than the FSCS).