Friday, 3 July 2015

Deposit protection cut

Money guaranteed in bank accounts will drop by £10,000 to £75,000 from the beginning of next year.

The change is the result of the strength of the pound in the currency market.

The deposit guarantee is harmonised across the European Union at €100,000, with a revaluation every 5 years.

But the euro has fallen, with the Greek crisis driving it even lower in recent weeks.

The result is that while bank account holders in the eurozone see no change in their level of protection, UK savers will have to put up with a significant reduction.

The Treasury said the change would have been implemented today but it was delaying it until January next year to give the public a chance to adjust to the lower level of protection.

The guarantee has stood at £85,000 since the end of 2010.

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