Current £85,000 level of protection reducing in the New Year.

The Financial Services Compensation Scheme (FSCS) deposit protection limit is being cut by £10,000 to £75,000 in the New Year.

The current £85,000 level of protection ends on 31 December 2015, when it will be reduced to £75,000. This comes about because of the EU deposit guarantee scheme which has set a harmonised limit of €100,000 across Europe.  

The Prudential Regulation Authority (PRA) is required by the European Deposit Guarantee Schemes Directive to recalculate the FSCS deposit protection limit every five years, maintaining a sterling amount equivalent to €100,000. Due to the depreciation of the euro, the new limit is £75,000.

According to the FSCS website, more than 95% of all savers will still be protected. It also points out that people with some types of temporary high balances will have FSCS protection up to £1m for up to six months. The proceeds from a house sale would fall into this category.

If you believe will be affected and wish to discuss your options, contact Kellands.

In the meantime, Happy New Year to you all.

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