Savers’ compensation limit rises

THE deposit compensation limit for savers has increased from £50,000 to £85,000 per person.

The Financial Services Authority (FSA) said the limit had been increased to bring the UK in line with a €100,000 limit which came into force in all European Economic Area (EEA) member states at the end of 2010.

The new limit replaces the existing UK arrangement which has been in place since 2009.

Sheila Nicoll, director of conduct policy at the FSA, said: “The need to maintain customer confidence in the banking system is one of the key lessons from the financial crisis.”

She added: “Alongside increasing the amount of depositor compensation, raising awareness of the compensation scheme is vital.”

The compensation covers deposits with UK banks and subsidiaries of foreign banks which operate in the UK.