Trading 212 - Safe for over £85000 cash ISA?

freeangel

Hello

Because Trading 212 hold portions of your money across three different banks, I'm just wondering if it would be safe to put substantially more than the £85000 per financial institution limit in their cash ISA. Thanks in advance for any advice.

DavidT67

It's safe to put more than £85K in most UK banks, never understood people's concern over FSCS for deposits with major banks.  I wouldn't lose sleep over the likes of JP Morgan or Barclays failing retail depositors.  'Too big to fail' would seem to apply.

PRAISETHESUN

freeangel said:

Hello

Because Trading 212 hold portions of your money across three different banks, I'm just wondering if it would be safe to put substantially more than the £85000 per financial institution limit in their cash ISA. Thanks in advance for any advice.

I don't think there's any guarantee that T212 will divide your money up in such a way as to minimise your exposure over the FSCS limit, but from my understanding you can at least view the breakdown of how your money is saved across the banks they use.

gravel_2

The breakdown of where the cash is today on my account is approx:
JPM: 16%
Barclays: 40%
NatWest: 44%

At this rate you could have £192k in and benefit from the protection. This assumes that the %s are consistent and that you don't hold other funds with those banks.

Anecdotally - the % breakdown has been fairly stable since I opened my ISA in May.

dave1247

I think it is unlikely that there is FSCS protection for a cash isa with Trading 212, as that protection is for individuals investing directly in a firm authorised with FCA to provide bank accounts or to take savings.

PRAISETHESUN

dave1247 said:

I think it is unlikely that there is FSCS protection for a cash isa with Trading 212, as that protection is for individuals investing directly in a firm authorised with FCA to provide bank accounts or to take savings.

https://www.trading212.com/money-protection

Your cash is kept separate from our own

When you use our Cash ISA product, 100% of your money is held at some of the world's largest banks. We appoint and review the banks, monitoring them continuously to ensure they remain appropriate to hold client money. Client money is segregated and held separately from our money in client money bank accounts. Your money is ring-fenced, meaning legally binding agreements ensure that your money belongs to you and cannot be accessed or used by us, the bank or anyone else, even in the event of firm failure.

FSCS protection

Your money is also protected by the Financial Services Compensation Scheme (FSCS) up to £85,000 per partner bank. This means that, in the unlikely event that one of our appointed partner banks fails, your money held with that bank is protected up to this limit.

It's important to note that the £85,000 limit applies to the total amount of money you hold at each specific bank, whether it's deposited by Trading 212, other providers, or by you directly. For transparency, the percentage of your cash held at each bank is available in the app under the "Interest on Cash" tab.

eskbanker

dave1247 said:

I think it is unlikely that there is FSCS protection for a cash isa with Trading 212, as that protection is for individuals investing directly in a firm authorised with FCA to provide bank accounts or to take savings.

FSCS protection

Your money is also protected by the Financial Services Compensation Scheme (FSCS) up to £85,000 per partner bank. This means that, in the unlikely event that one of our appointed partner banks fails, your money held with that bank is protected up to this limit.

It's important to note that the £85,000 limit applies to the total amount of money you hold at each specific bank, whether it's deposited by Trading 212, other providers, or by you directly. For transparency, the percentage of your cash held at each bank is available in the app under the "Interest on Cash" tab.

Learn more about how the FSCS works here.

https://www.trading212.com/money-protection

Alexland

It's also worth noting in the event of a loss caused by T212's failure (rather than the failure of the banks they use) and T212 were unable to compensate you the FSCS protection would still be limited to £85k.

wiseonesomeofthetime

Alexland said:

It's also worth noting in the event of a loss caused by T212's failure (rather than the failure of the banks they use) and T212 were unable to compensate you the FSCS protection would still be limited to £85k.

So, going back to OP's question, is that a NO then. More than £85,000 wouldn't be safe.

Given that transfers out cannot be partial, it makes it impossible to break your Cash ISA up yourself into smaller safer portions easily 🤷‍♂️

Izzywhizzyletsgetbizzy

wiseonesomeofthetime said:

Alexland said:

It's also worth noting in the event of a loss caused by T212's failure (rather than the failure of the banks they use) and T212 were unable to compensate you the FSCS protection would still be limited to £85k.

So, going back to OP's question, is that a NO then. More than £85,000 wouldn't be safe.

Given that transfers out cannot be partial, it makes it impossible to break your Cash ISA up yourself into smaller safer portions easily 🤷‍♂️

Thought my query was answered ( same as original poster) then  saw your comment.. surely you can split a transfer out..?  Have you checked with 212

Izzywhizzyletsgetbizzy

freeangel said:

Hello

Because Trading 212 hold portions of your money across three different banks, I'm just wondering if it would be safe to put substantially more than the £85000 per financial institution limit in their cash ISA. Thanks in advance for any advice.

Hi..did you get a definitive answer..seems to me the money is devided between 3 holding banks..the statement below says each one has the £85k protection..?