Worried about what happens if your bank goes bust? In the UK, your money is protected by the Financial Services Compensation Scheme (FSCS), which helps ensure your savings are safe, even if your bank fails.

What Is the FSCS?

The FSCS is a government-backed scheme that protects your money if a UK bank, building society, or credit union goes out of business. It automatically compensates eligible customers up to a certain limit without you needing to lift a finger.

How Much Is Protected?

The FSCS protects up to £85,000 per person, per authorised institution. This means:

• If your bank fails, you're guaranteed to get up to £85,000 of your money back
• Joint accounts are covered up to £170,000 (£85,000 per person)

What Counts as an “Authorised Institution”?

Some banking brands share a banking licence. For example, Halifax and Bank of Scotland are both part of Lloyds Banking Group — meaning the £85,000 limit applies across all their brands combined.

To check if banks are part of the same group, visit the FCA Register.

What Types of Accounts Are Covered?

The FSCS covers most common personal and business accounts, including:

• Current accounts
• Savings accounts (including ISAs)
• Cash deposits in fixed-term bonds

What’s Not Covered?

FSCS protection doesn’t apply to:

• Investments (e.g. shares, bonds, funds) — unless the firm goes bust and mis-sold them
• Cryptocurrencies (not covered at all)
• Non-UK institutions or unauthorised firms

Temporary High Balances

The FSCS can cover balances above £85,000 for up to six months in certain situations, such as:

• Inheritance
• House sale proceeds
• Insurance payouts

This gives you time to spread funds or make a long-term decision.

How Long Does It Take to Get Your Money Back?

The FSCS aims to pay compensation within 7 days of a bank failing for deposit claims. You don't need to apply — it’s automatic if you're eligible.

How to Maximise Your Protection

• Split large sums across different banking groups
• Use joint accounts to double the limit
• Check if your bank is FSCS-authorised on the FCA register

Final Thoughts

Most people never need to worry about bank failures, but the FSCS offers peace of mind. If you have savings over £85,000, consider spreading them across banks to stay within limits. And remember: crypto and investments are not covered like cash deposits are.