There’s good news on the horizon for savers. From 1 December 2025, the Financial Services Compensation Scheme (FSCS) will be increasing the amount of protection available on bank and building society deposits. This update follows confirmation from the Prudential Regulation Authority (PRA) and comes after months of consultation (and a fair bit of speculation).
Increasing the standard FSCS limit
The standard FSCS limit will rise from £85,000 to £120,000 per person, per financial institution, a sizeable jump of just over 41%. This is higher than the PRA originally proposed earlier in the year, thanks to updated inflation data showing how much the cost of living has moved since the old limit was set back in 2017.
There’s also an uplift to the Temporary High Balance (THB) protection, which covers larger deposits linked to major life events, such as receiving an inheritance, a property transaction or an insurance payout. The limit will increase from £1 million to £1.4 million, still protected for six months from the date the money hits your account.
A useful reminder, FSCS protection applies per customer, per banking licence, not per brand. So, if two banks share a licence (for example, Halifax and Bank of Scotland), your combined deposits across them count as one pot for FSCS purposes. On the plus side, joint accounts will benefit from £240,000 of protection from 1 December.
Banks and building societies have until May 2026 to update their documents, but the increased protection takes effect this year.
