£50,000 guarantee limit

Martyn_H

Hi

Given that only banks and building societies in the UK have fallen into difficulties, do you think it is safe to invest more than £50,000 with Tesco, as it is highly unlikely that it will go bust?

Thank you,

Martyn

Baldur

Tesco isn't guaranteed to be immune to the current economic situation - http://www.internationalsupermarketnews.com/index.php/the-news/714-tesco-market-share-under-attack

Aegis

Martyn_H wrote: »

Hi

Given that only banks and building societies in the UK have fallen into difficulties, do you think it is safe to invest more than £50,000 with Tesco, as it is highly unlikely that it will go bust?

Thank you,

Martyn

I think it makes little difference. The government has shown that it won't allow UK banks to fail, nor will deposits in foreign banks registered in the UK be lost.

From the recent actions, I'd say just go with a UK financial organisation that offers you a good rate. Of course, do your own research and decide for yourself, and you might also look in to who manages the finances for Tescos, as it might not actually be the supermarket itself.

Martyn_H

Aegis wrote: »

From the recent actions, I'd say just go with a UK financial organisation that offers you a good rate. Of course, do your own research and decide for yourself, and you might also look in to who manages the finances for Tescos, as it might not actually be the supermarket itself.

Hmm, I hadn't thought about who manages the finances. I guess I was comparing Tescos with Woolworths in terms of stability.

dunstonh

Given that only banks and building societies in the UK have fallen into difficulties

Apart from those in other countries that have as well.

opinions4u

Martyn_H wrote: »

Given that only banks and building societies in the UK have fallen into difficulties, do you think it is safe to invest more than £50,000 with Tesco, as it is highly unlikely that it will go bust?

Many credit unions in the UK have failed. Many banks overseas have collapsed or been rescued.

In the UK, the Government were more than willing to let people lose their savings when a hamper firm went under (not covered by the FSCS).


The answer to your question is:

1) I doubt the Government will let anybody lose money in the event of any UK financial institution failing. But it isn't impossible that they will draw a line in the sand if the situation deteriorates further.
2) Tesco Personal Finance is a bank in the UK.
3) If you have concerns, spread your money around.
4) Their service is mediocre to date - so why would you?

PinkPig

Trying to guess whether particular companies might be in trouble in the future is a tricky buisness, and lots of people have got it wrong lately. You can be reassured by the £50,000 guarantee, and, less strongly, by the government demonstrating that it is unlikely to allow the public to lose money from deposits in retail banks.

Does being a supermarket put Tesco in a better position than banks and building societies? I've no idea, but if we're being very general the retail sector isn't in the best possible shape either.

My view would be that, at the moment, losing money by having more than £50,000 in a UK bank account is very unlikely - but I would probably have said the same about Icesave a year ago and it looked pretty uncertain for a while. The last year has shown that things can sometimes change unexpectedly.

The compensation limit means that having more than £50,000 with a single financial institution just might make a difference at some point in the future. I know that if I had more than £50,000 to save I would split it up a bit.

Martyn_H

dunstonh wrote: »

Apart from those in other countries that have as well.

I was only concerning myself with UK institutions but I didn't make that clear. My question was hypothetical.