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"Room for confusion" as PRA proposes to raise the deposit protection limit of the FSCS from £85,000 to £110,000

ended 31. March 2025

The Prudential Regulation Authority (PRA) has today proposed to raise the deposit protection limit of the Financial Services Compensation Scheme (FSCS) from £85,000 to £110,000. The proposed increase takes into account inflation since the limit was last changed, and is designed to give consumers confidence that their money is safe if their UK-authorised bank, building society or credit union fails. If taken forward, the new limit would apply to firms that fail from 1 December 2025.

Sam Woods, Deputy Governor for Prudential Regulation and CEO of the PRA said: “Confidence in our financial system is an essential foundation for economic growth. We want to support confidence in our banks, building societies and credit unions by raising the amount that people can keep in their account which is covered by the deposit guarantee scheme to £110,000 per person, so all that money is safe even if the firm fails.”

Martyn Beauchamp, CEO of the FSCS, said: “Depositor protection is what FSCS is best known for, as it covers the money held in our day-to-day current accounts and savings. Consumers tell us that the existence of FSCS protection is a key driver of their trust in financial services, and this trust is in turn a critical component of stability and growth. It’s important that FSCS’s limit is reviewed to ensure it stays appropriate and relevant.”

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4 responses from the Newspage community

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Rob MansfieldVerified
Independent Financial Advisor at Rootes Wealth Management
A higher FSCS limit is great news for savers and for confidence in our banking system. For those holding significant cash savings it will provide more shelter. Uprating the limit in line with inflation is very welcome. The Government need to be careful about mixed messages as there are rumours that Cash ISAs will be made less attractive to try and promote investment and so there is room for confusion if cash is being rewarded and punished at the same time.
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Bob SinghVerified
Founder at Chess Mortgages
The move will be welcomed by consumers as it will provide them with greater security for their savings. Some savers may no longer need to spread their savings across a few lenders to avail themselves of the safety net.
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Pete MuglestonVerified
Mortgage Advisor & Managing Director at onlinemortgageadvisor.co.uk
Raising the FSCS protection limit to £110,000 is a sensible move that reflects inflation and rising savings balances. It’s a positive step for consumer confidence, especially in a climate where financial stability is increasingly on people’s minds. Knowing that more of their money is protected if a bank fails can give savers peace of mind and help maintain trust in the system. While most people won’t exceed the current £85,000 cap, for those with larger deposits—such as after a house sale or inheritance—this change offers much-needed reassurance and better aligns with today's economic realities.
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Riz MalikVerified
Independent Financial Adviser at R3 Wealth
Even though the great financial crash was some time ago, the FSCS limits still weigh on people's minds. I was just speaking to clients considering moving some of their savings so they do not exceed the current limit. If this were increased, they would not have to, making administration much easier. We need simplification. Otherwise, clients can get confused or concerned unnecessarily.