FSCS deposit protection: how the £85,000 limit really works
Quick answer: The Financial Services Compensation Scheme protects up to £85,000 per person, per authorised bank or building society, if your provider fails.
The Financial Services Compensation Scheme protects up to £85,000 per person, per authorised bank or building society, if your provider fails. The trap is that several familiar brands often share one banking licence — so the limit covers the group, not each brand.
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Primary source: https://www.fscs.org.uk/what-we-cover/banks-building-societies/
What FSCS actually covers
FSCS protects cash deposits — current accounts, savings accounts and cash ISAs — held with UK-authorised banks, building societies and credit unions. If the provider goes bust, you can claim back up to £85,000 per person per institution, normally within seven working days for most claims.
Protection is automatic. You do not need to register, and the scheme is free. It is funded by a levy on regulated firms.
Investments, pensions and insurance have separate FSCS rules and limits, not covered here.
How banking groups share a licence
The £85,000 limit applies per FCA/PRA authorisation, not per brand. Many groups operate several customer-facing brands under one licence — meaning if you spread £85,000 across each brand in the same group, you only have £85,000 of total protection, not several lots of it.
Examples of shared licences include HSBC UK (HSBC, First Direct, M&S Bank), Lloyds Banking Group (Lloyds, Halifax, Bank of Scotland on one licence; BM Savings separate), and Bank of Ireland (Bank of Ireland UK, Post Office Money savings).
You can check whether two providers share a licence using the FSCS protection checker on the FSCS website.
The temporary high balance rule
If you receive a large one-off payment — sale of a main home, redundancy lump sum, inheritance, divorce settlement, insurance payout, personal injury compensation — FSCS protects up to £1,000,000 on top of the £85,000 for six months from the date the money is credited.
After six months the cover drops back to the standard £85,000, so if you are sitting on a much larger balance, you will normally want to spread it across multiple banking groups before the window ends.
Common questions
- Are my National Savings & Investments products FSCS-protected?
- No — and they don't need to be. NS&I is backed by HM Treasury, so 100% of your money is protected by the UK Government regardless of amount.
- What about EU or offshore banks?
- Only UK-authorised institutions are covered by FSCS. EU banks have their own national schemes (typically €100,000), and offshore deposits in places like Jersey or the Isle of Man have separate, usually lower, schemes.
- Is my money safe with app-based banks like Monzo, Starling or Chase?
- Yes, assuming they hold UK banking authorisation. Monzo, Starling and Chase UK are all UK-authorised banks with full £85,000 FSCS cover. Some app providers (e.g. Revolut UK) operate on a different basis — always check FSCS status before depositing large sums.