Cash ISA maturing-above FSCS limit

Warslet

I have a cash ISA with Secure Trust Bank maturing in November 2024 and the balance plus interest will exceed the FSCS limit of £85000. I had the same issue with them last year but decided to re-invest as the rate was better than I could find elsewhere. 
I have e-mailed to check but they seem to want you to invest the full amount on maturity even if over the FSCS limit or the balance has to be transferred elsewhere. 
Is this normal practice as it means transferring elsewhere then doing another transfer to keep within the FSCS  limit?

eskbanker

It's their prerogative to only offer full transfers into a new product, but as you say, if you don't want to leave it that way you can transfer some elsewhere, provided of course that they support partial transfers out.

Warslet

Update on the original message.  Secure Trust Bank will not allow a partial re-investment and I have decided to move the funds. They won't allow partial transfers either. 
I will need to do the following to stay within the FSCS limit when transferring:  Transfer the full amount to an Easy Access ISA elsewhere as the Secure Bank rate is 2% AER for maturing products and then transfer an amount to another provider to stay within the FSCS limit with any provider I'm with.   I don't see this to be an issue as long as any new provider (thinking of Trading 212) will accept transfers in and then a transfer out?

subjecttocontract

I had the same issue as you last year with Secure Trust. I did exactly what you are proposing to do, except I didn't deal with Trading 212. This time last year there were plenty of great ISA offers around....not so much the situation now.

Albermarle

Warslet said:

Update on the original message.  Secure Trust Bank will not allow a partial re-investment and I have decided to move the funds. They won't allow partial transfers either. 
I will need to do the following to stay within the FSCS limit when transferring:  Transfer the full amount to an Easy Access ISA elsewhere as the Secure Bank rate is 2% AER for maturing products and then transfer an amount to another provider to stay within the FSCS limit with any provider I'm with.   I don't see this to be an issue as long as any new provider (thinking of Trading 212) will accept transfers in and then a transfer out?

There are quite a few recent threads about T212 ISAs, so suggest you have a look at those.

10bears

Does anybody have any thoughts regarding the FSCS limit being increased any time soon. It's been £85000 for several years now, having been reduced from £100,000, so ought to be due a raise.

10bears

Correction - According to Copilot AI it has never been at £100,000, but was £75,000 prior to January 2017 when it was raised to £85,000. My error for not doing my research before posting.

wmb194

10bears said:

Does anybody have any thoughts regarding the FSCS limit being increased any time soon. It's been £85000 for several years now, having been reduced from £100,000, so ought to be due a raise.

Highly unlikely. It was set at £85k and £75k to, adjusting for the exchange rate, match the EU's mandated coverage of €100k. £85k * 1.20 = €102k. If was increased this would likely lead to an increase in the FSCS's annual fees as well and the firms affected by this wouldn't be happy. 

Anyway, £85k's enough for most people and if necessary it's easy to spread your money around. If you want 100% cover from the Treasury you can use NS&I and gilts.