MSE News: FSA to raise awareness of FSCS deposit protection scheme

Former_MSE_Helen
Former_MSE_Helen Posts: 2,382 Forumite
edited 14 December 2011 at 7:15PM in Savings & investments
This is the discussion thread for the following MSE News Story:

"Banks could be made to display information on how much compensation savers could claim if an institution fails ..."
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Comments

  • dunstonh
    dunstonh Posts: 116,288 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    As long as they dont waste millions like they did last time on pointless TV adverts that research showed no-one took any notice of.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • opinions4u
    opinions4u Posts: 19,411 Forumite
    Well, it's not as if it's on most items of savings account literature.

    Or every statement I get.

    Or on that personalised letter I got from a provider I forgot I had an account with 38p in.

    Clearly chucking away £millions on nothing is a good idea for the regulator that sat idly by in the years ahead of the events that triggered the need for the FSCS to be used.
  • jamesd
    jamesd Posts: 26,103 Forumite
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    So far it seems to be just duplicating standard practice in the US: every bank there has the protection limit displayed in a small poster in the branch.

    Agree about the shared with declaration requirement. It's essential or it's misleading.
  • Consumerist
    Consumerist Posts: 6,310 Forumite
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    No wonder the FSA is getting the boot. They're worse than useless. Good riddance, I say.

    Citizens Advice couldn't do any worse.
    >:)Warning: In the kingdom of the blind, the one-eyed man is king.
  • In my opinion if you have over £85k with one institution then you should be relatively worldly aware, if you are not then you should make yourself so.

    In what other industry are we spoon fed such inane drivel.

    Not really sure what this article is looking to achieve, nice bit of shock journalism attempt, however which ever way you look at it, its not that complicated.

    Trying to figure out if I am better off moving electricity suppliers on the other hand.....;)
  • Consumerist
    Consumerist Posts: 6,310 Forumite
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    Not really sure what this article is looking to achieve, nice bit of shock journalism attempt, however which ever way you look at it, its not that complicated.
    Oh Really!

    You seem to suggest that you should know how to find a new energy supplier if you use energy. According to that, why do you find it so difficult?

    The article is clearly trying to achieve the goal of getting the incompetent FSA to get off its lazy backside to compel banks to prominently declare any other financial institutions with whom their customers' £85,000 protection is shared. Is that asking too much?

    In reality, where the FSA is concerned, there is fat chance of that. The FSA is merely an industry spokesman who occasionally does something to help the consumer but only when forced by the weight of evidence of its stupidity.
    >:)Warning: In the kingdom of the blind, the one-eyed man is king.
  • Oh Really!

    You seem to suggest that you should know how to find a new energy supplier if you use energy. According to that, why do you find it so difficult?

    The article is clearly trying to achieve the goal of getting the incompetent FSA to get off its lazy backside to compel banks to prominently declare any other financial institutions with whom their customers' £85,000 protection is shared. Is that asking too much?

    In reality, where the FSA is concerned, there is fat chance of that. The FSA is merely an industry spokesman who occasionally does something to help the consumer but only when forced by the weight of evidence of its stupidity.

    Looking to see holds the financial licence on your savings accounts if over £85k is hardly an arduous task, if unsure pick up the phone? I am struggling to see the challenge here.

    My comparison was based upon the insane amount of variables within the energy market.

    Different standing charges for different providers
    Different charges for tiered energy consumption up to x Kw/h
    Different charges for a / b rate consumption

    Then having to understand your previous bills and usage to establish what category you would fall into.

    My point was that something as minimal as a £40 monthly DD is far more of a challenge then understanding the top level company that owns your money.

    In the grand scheme of things, I don't think a phone call to ensure your £85k is not at risk is really an excessive gesture?

    I tell you what if you have over £85k then I will do the phoning around for £100, sound like a deal? :p
  • opinions4u
    opinions4u Posts: 19,411 Forumite
    The article is clearly trying to achieve the goal of getting the incompetent FSA to get off its lazy backside to compel banks to prominently declare any other financial institutions with whom their customers' £85,000 protection is shared. Is that asking too much?
    They are already required to do that. They are required to provide the information on statements twice yearly. If statements are issued less often, annually is the absolute minimum. If no statement is issued, a letter must be sent.

    The message below is from the Halifax web site. Similar information required on statements or in the letter I just mentioned:
    Under the Financial Services Compensation Scheme you are covered separately for the deposits you have with each separately licensed bank.

    Bank of Scotland plc and Lloyds TSB savings continue to be covered separately under this scheme, as both organisations are covered by different banking licences. Should there be any changes to our banking licences in future, we will contact you to tell you about them in the usual way.

    Deposits with us are held with Bank of Scotland plc and are covered by the Bank of Scotland banking licence.

    £85,000 (£170,000 for joint accounts) is the maximum compensation you could get for all of your money held in bank accounts or savings accounts with Bank of Scotland plc.

    Accounts with Bank of Scotland plc include accounts with its divisions and trading names: Halifax, Intelligent Finance (IF), Birmingham Midshires (BM Savings), Bank of Scotland, Bank of Scotland Private Banking, Bank of Scotland Germany, Bank of Scotland The Netherlands, Bank of Scotland Treasury, Lloyds Bank Corporate Markets, Lloyds TSB Corporate Markets, St James's Place Bank and St James's Place Private Bank. Some savings accounts under AA Savings, Saga and Charities Aid Foundation brand names are also deposits with Bank of Scotland plc. An eligible depositor's £85,000 limit relates to the combined amount under all of these names.

    If you are unsure whether your account is held with a Bank of Scotland plc, please check your account literature.
    Lloyds TSB has three core licensed banks operating on the high street, Lloyds TSB Bank, Lloyds TSB Private Banking and Lloyds TSB Scotland, plus two further licences for subsidiaries, Agricultural Mortgage Corporation Bank and Scottish Widows Bank.
  • Consumerist
    Consumerist Posts: 6,310 Forumite
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    edited 14 December 2011 at 11:25PM
    Looking to see holds the financial licence on your savings accounts if over £85k is hardly an arduous task, if unsure pick up the phone? I am struggling to see the challenge here.
    The problem is that it is not always easy to see, at the point of applying for an account, whether your £85k protection is shared with accounts with another institution.

    I see opinions4u's post where Halifax do seem to volunteer the information but, so far as I am aware, they are not compelled to give that detail.
    My comparison was based upon the insane amount of variables within the energy market.
    In truth, you'll get no argument from me on that one. :)
    I tell you what if you have over £85k then I will do the phoning around for £100, sound like a deal?
    No comment. :o
    >:)Warning: In the kingdom of the blind, the one-eyed man is king.
  • opinions4u
    opinions4u Posts: 19,411 Forumite
    Nationwide:
    Nationwide operates under the trading names of Nationwide Building Society, Cheshire Building Society, Derbyshire Building Society and Dunfermline Building Society.
    It is important to note that from 31 December 2010 the new FSCS limit of £85,000 per individual (or £170,000 for joint account holders) applies to the combined amount in all the eligible depositor’s accounts across any one or more of the Nationwide Group trading names.

    Co-op Bank:
    The Co-operative Bank plc is covered by the Financial Services Compensation Scheme (FSCS), which would pay compensation of up to £85,000 to eligible depositors in the event of the Bank becoming insolvent. smile and Britannia are trading names of The Co-operative Bank and, as such, protection provided to depositors by the FSCS is limited to £85,000 for the total amount of combined deposits held with The Co-operative Bank, smile and Britannia.
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