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

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Comments

  • pqrdef
    pqrdef Posts: 4,552 Forumite
    If a bank goes bust, people will find out their compensation rights soon enough.

    If it doesn't, the issue doesn't arise.

    The only reason customers need to be told anything about this stuff now, is if they already have "a little knowledge" and are incorrectly assuming that they have more protection than they actually do.

    Banks may like to push FSCS for promotional reasons, but the only reason for the regulator to get involved is to make sure people know about the caveats.

    I suppose it's too much to expect banks to identify customers who are over the limit, or close to it, and write to them with a specific warning?
    "It will take, five, 10, 15 years to get back to where we need to be. But it's no longer the individual banks that are in the wrong, it's the banking industry as a whole." - Steven Cooper, head of personal and business banking at Barclays, talking to Martin Lewis
  • jamesd
    jamesd Posts: 26,103 Forumite
    Name Dropper First Post First Anniversary
    There is another reason to get involved: to reassure people and decrease the chance of them engaging in a run on a bank. Back when Northern Rock was becoming insolvent it was the rational thing to do to withdraw all of your money from it because the protection didn't cover 100% of the money. Now it does up to the cap.
  • System
    System Posts: 178,090 Community Admin
    Photogenic Name Dropper First Post
    The other point of interest for me is : How many people will actually have more than the FSCS limit saved with one institution ?

    I tend to think the number of people effected will be relatively low and hence aren't there more urgent matters for the regulatory bodies to deal with first ?

    They should not spend a fortune on fixing a perceived problem that has relatively little benefit to the majority.
  • opinions4u
    opinions4u Posts: 19,411 Forumite
    BAA1 wrote: »
    The other point of interest for me is : How many people will actually have more than the FSCS limit saved with one institution ?

    I tend to think the number of people effected will be relatively low and hence aren't there more urgent matters for the regulatory bodies to deal with first ?

    They should not spend a fortune on fixing a perceived problem that has relatively little benefit to the majority.
    It will be around 2%.

    Although they probably hold around a third of all the money.
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