The Bank of England's Prudential Regulation Authority (PRA) has published a consultation proposing to increase the Financial Services Compensation Scheme (FSCS) deposit protection limit from GBP 85,000 to GBP 110,000. If implemented, the new limit would apply to deposits at UK-authorised banks, building societies and credit unions that fail from 1 December 2025, with any change requiring HM Treasury approval. The package also proposes raising the limit for certain temporary high balance claims linked to qualifying life events from GBP 1 million to GBP 1.4 million, with effect from 1 December 2025. In addition, the PRA is consulting on rules intended to facilitate the Bank Resolution (Recapitalisation) Bill by enabling industry funds provided via the FSCS to be used to recapitalise a failing firm to support a sale or transfer to a bridge bank, with the PRA planning to make these rules once the relevant legislative provisions are enacted and brought into force. Responses on the FSCS protection limit proposals are requested by 30 June 2025, while responses on the recapitalisation-related proposals are requested by 30 April 2025. The PRA expects to confirm the outcome of the consultation in November 2025.
Bank of England 2025-03-31
Bank of England's Prudential Regulation Authority consults on raising FSCS deposit protection to GBP 110,000
The Bank of England's Prudential Regulation Authority is consulting on raising the Financial Services Compensation Scheme deposit protection limit from GBP 85,000 to GBP 110,000, effective 1 December 2025, pending HM Treasury approval. The proposal also includes increasing the limit for temporary high balance claims from GBP 1 million to GBP 1.4 million. Additionally, the PRA is consulting on rules to enable FSCS funds to recapitalize failing firms, supporting sales or transfers to bridge banks, contingent on legislative enactment.