Moneybox---Why Does FSCS Say Not Protected?

daveoc22

Given the new 5% cash isa rate I was about to sign up but I thought I would just check the FSCS site to confirm they cover the £85000 in case of problems.

The Moneybox site says they are covered but if you put their name into the FSCS site it says they are not covered.

I know many people on here use Moneybox, and I am sure they will have checked on cover if something goes wrong, so why does the FSCS site say what it does?.

Middle_of_the_Road

daveoc22 said:

Given the new 5% cash isa rate I was about to sign up but I thought I would just check the FSCS site to confirm they cover the £85000 in case of problems.

The Moneybox site says they are covered but if you put their name into the FSCS site it says they are not covered.

I know many people on here use Moneybox, and I am sure they will have checked on cover if something goes wrong, so why does the FSCS site say what it does?.

Moneybox hold your funds in banks that are protected. Think NatWest is one of those.
https://www.moneyboxapp.com/fscs-protection/

Moneybox Cash ISA

Moneybox uses a range of banks for its Cash ISA. The proportion of money held with each bank can vary over time. However, we will never hold more than 50% of the total funds with a single bank at any given moment.

The banks we use change over time. The banks we currently use are:

• HSBC Bank plc
• Santander UK plc
• National Westminster Bank plc
• Clydesdale Bank plc
• Bank of Scotland plc
• Lloyds Bank plc
• Qatar National Bank (Q.P.S.C.)
• First Abu Dhabi Bank P.J.S.C.
• National Bank of Kuwait (International) plc
• The Bank of New York Mellon, London Branch
• Barclays Bank plc

 

daveoc22

Ah, so does that mean that Moneybox themselves are not protected but they have to ringfence the isa cash with those banks and that is where the protection lies?.

masonic

daveoc22 said:

Ah, so does that mean that Moneybox themselves are not protected but they have to ringfence the isa cash with those banks and that is where the protection lies?.

Moneybox is is protected, but it doesn't have a banking licence, so isn't included in the FSCS site, which focuses on banks and building societies. If a firm has the Client Money permission on the FCA register, then money it holds for you is FSCS protected. But if it went bust, it is very likely all of your money would be ringfenced in one or more of the partner banks and you wouldn't need compensation.

400ixl

You have to then consider which license is protecting your ISA. If you put £85k in an Moneybox ISA under the HSBC license then had savings account with £10k with HSBC directly, £10k is not covered.

Barkin

400ixl said:

You have to then consider which license is protecting your ISA. If you put £85k in an Moneybox ISA under the HSBC license then had savings account with £10k with HSBC directly, £10k is not covered.

According to the quote above, max 50% of the £85k would be held with HSBC (in your example) so an additional £10k with HSBC direct would only total £52.5k

And I believe that the whereabouts and proportions aren't fixed.

Keeping track of these shenanigans is one reason that I avoid these type of arrangements.