THE TELEGRAPH: Savers should have £500,000 worth of their savings protected if a bank or building society collapses, says the Financial Services Authority.
The City watchdog called for the "quantum leap" in the level of protection offered by the Financial Services Compensation Scheme from its current level of £50,000, saying it would boost confidence among savers.
If a bank goes bust, the FSCS will repay up to £50,000 per person, per authorised bank or building society.
However, there would be a time limit of six months on the additional protection covering balances stemming from selling a property or a divorce settlement.
Thomas Huertas, a director at the FSA, said: "Our proposals will protect people who have little or no choice about holding a high balance for a limited period over the current FSCS limit of £50,000 before they can diversify it, if they wish, between different institutions."
Experts welcomed the proposals, saying they would help to reassure savers amid the economic turmoil. >>> By Myra Butterworth, Personal Finance Correspondent | Tuesday, March 31, 2009
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