Protection

The Lending Code is a voluntary code of practice which sets standards for the way financial institutions treat their customers. It provides protection for customers and explains how firms are expected to deal with them day-to-day and in times of financial difficulties.

Regulation
UK savings providers are regulated by the Financial Services Authority (FSA).

Compensation
If a bank or building society goes bust the Government guarantees to compensate savers. The Financial Services Compensation Scheme (FSCS) is a compensation fund of last resort and pays out up to certain limits.

Top tips

  • Compensation under the FSCS applies per institution and not per account, so if you had two savings accounts with the same provider, you would still only be protected up to the specified limit.
  • It may be worth contacting the FSCS before you open an account with a foreign-owned bank to ensure you will be covered.
  • If you have a large amount in savings it's worth spreading your money between different institutions. Beware though; some institutions have the same parent company which means you'll only be protected once.

 

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