This website uses cookies. Find out more.

  • Contact
  • Client Login
Chase de Vere
Trustpilot
  • Services
    • Advice for you
    • Advice for your business
    • Partner With Us
    • Advice on Personal Injury Awards
    • Advice for Medical Professionals
    • Advice for Dental Professionals
  • About
  • Careers
  • Insights
  • Contact
0345 609 2002 Book Appointment

Advice for you

Advice for your business

Partner With Us


Advice on Personal Injury Awards

(Off-site link)

READ MORE
Advice for Medical Professionals

(Off-site link)

READ MORE
Advice for Dental Professionals

(Off-site link)

READ MORE
Back to Insights
News

Bank deposit protection set to rise?

11 May 2023
  • Share

The recent problems in the banking world have raised questions around the current maximum protection for bank deposits: is it overdue for an increase?

The figure of £85,000 is one you might have regularly seen in articles (or some adverts) about bank deposits. It is the maximum deposit value in an authorised deposit-taking institution that is covered by the Financial Service Compensation Scheme (FSCS). If the deposit is in joint names, the £85,000 is doubled. However, there is a trap to watch out for – more than one bank may operate under the same banking license. For example, the Halifax’s license also covers the Bank of Scotland, Birmingham Midshires and St James Place Bank.

With the recent problems in the banking world, such as the demise of Silicon Valley Bank in the US and Credit Suisse’s forced marriage to its Swiss rival, UBS, attention has been turning again to that £85,000 compensation figure. It was last revised in January 2017, when it was increased from £75,000. The limit had also been £85,000 between December 2010 and July 2015 before being cut under EU deposit protection rules, which set the limit at the sterling equivalent of €100,000 (the pound was stronger in those pre-Brexit days).

If the limit had been index-linked since it was first set at £85,000, it would now be around £120,000. Both the Chancellor and the Governor of the Bank of England recently suggested that the FSCS limit should be raised, but not because inflation had cut its value by almost a 30%. Their concern was more that the UK’s last experience of a bank run – queues outside Northern Rock in 2007 – reflected a different era.
If there were a Northern Rock Mk II crisis today, the news would be all over social media instantly and there would be no queues outside (any surviving) branches because all the customers would be withdrawing their deposits by phone, tablet or computer. Money would drain away much quicker than it did 16 years ago.

The logic behind the call for a higher level of deposit protection is that it would mean a smaller number of depositors anxious to withdraw their money. Stemming the outflow is crucial to keeping a bank alive.
What neither the Chancellor nor Governor mentioned was the wisdom of having £85,000-plus in deposit at a time when inflation is so much higher than the rate of interest available.

The value of your investment and any income from it can go down as well as up and you may not get back the full amount you invested.

Past performance is not a reliable indicator of future performance.

The contents of this article are for information purposes only and do not constitute individual advice.

  • Share

Related Insights

11 April 2023

Automatic enrolment and pension contribution reforms

A new government bill indicates that…

News
View Article
13 April 2023

Dive into the inspiring journey of a 101-year-old…

As Independent Financial Advisers, we’re able…

News
View Article
11 May 2023

Child Trust Funds: £394 million unclaimed

A recent report has highlighted the…

News
View Article

TO FIND OUT HOW CHASE DE VERE CAN HELP YOU ACHIEVE YOUR GOALS, ARRANGE YOUR COMPLIMENTARY CONSULTATION.

ARRANGE APPOINTMENT

Related Services

Advice for you

We offer our clients attentive, focused, financial guidance from highly qualified independent advisers located throughout the UK. Whether you’re saving for the future, enjoying your retirement or fu...

Learn more
JOIN OUR SUBSCRIPTION SERVICE TO RECEIVE:

EDUCATIONAL NEWS UPDATES & UPCOMING EVENTS

By signing up to our email subscription service we will send you regular emails with the latest insights from Chase de Vere. By signing up you are agreeing to our term and conditions that can be found here.

Chase de Vere
  • 0345 609 2002
  • client.services@chasedevere.co.uk
  • Home
  • About
  • Accessibility
  • Cookies
  • Gender Pay Gap Report
  • How to make a complaint
  • Insights
  • Modern Slavery Statement
  • Privacy
  • Terms of Use
  • Linkedin

Disclaimer:

Investments can go up and down in value, so you could get back less than you put in.
The Financial Conduct Authority does not regulate cash flow planning, tax or estate planning.

© Copyright Chase de Vere / 2025