current account not covered??

zaksmum

I've just been in the Halifax where I arranged for my savings account to be transferred to an account paying better interest.

In the course of conversation a manager, who was observing the young lady dealing with my account, said that funds held in any current account in any bank were not covered by the Financial Services Guarantee of £50,000. Only savings and investments were thus covered, he said.

So if you had, say, £10K in a current account and £40K in a savings account you would only be covered for the £40K and the £10K you had in your current account would be lost in the event of that bank becoming insolvent, as current account funds are not savings, he added.

I've certainly never heard that before and believe all funds with all UK member financial institutions are covered up to £50K per individual. He insisted I was wrong and we had a heated discussion, which he ended by assuring me he was a senior Halifax manager and knew what he was talking about.

Who's right here?

lisyloo

My interpretation of the FSCS site is that you are correct

• Deposits
  
  money placed in a bank or similar institution to earn interest or for safe-keeping.

It looks to me like money in a current account is still a "deposit".
Note the £50K limit is per depositor so it's for the total regardless of how many accounts you have (although it's per person for joint accounts).

iltisman

When my current account is flush with cash the bank rings me and tells me it is not safe to keep my money there and I should put it in
one of their hopeless savings products. I usually wind them up by asking if they lock the safe at night etc.

opinions4u

The senior Halifax manager is talking tosh.

As a former mid-ranking Halifax manager who (usually) knew what he was talking about, that was par for the course from those up the line .

zaksmum

I can't imagine why the bank would feel the need to ring and say it's not safe to leave money in a current account. If - as my bank has said in the past - the current account is more likely to fall victim to scammers, the bank would be surely liable anyway if any money went missing due to bank staff mistakenly paying it out to conmen?

zaksmum

opinions4u wrote: »

The senior Halifax manager is talking tosh.

As a former mid-ranking Halifax manager, that was par for the course .

What, talking tosh? That's what I thought. Are all Halifa staff so poorly informed? Is it any wonder we don't trust financial advisers??

opinions4u

zaksmum wrote: »

Are all Halifa staff so poorly informed?

No. But it does sound like you found one who is a long way up his/her .... self.

Too much focus on sales. Not enough focus on knowledge.

juicyjude

What a load of rubbish!!! Seems the customer knows more than the "experts". No wonder the banks are in such a state! Zacsmum, think you have your answer on here dont you.

juicyjude

Sorry Zaksmum

zaksmum

I think you're right juicyjude! Looking quite obvious that the Halifax manager didn't know what he was talking about...and he was quite pompous about it too.

I was certain the current account is covered, but when you hear the opinion of someone like that, you do question your own judgement.

juicyjude

I know you assume they know their job lol!