Looking after your savings is important, and so is knowing they’re safe. The Prudential Regulation Authority (PRA) wants to raise the Financial Services Compensation Scheme (FSCS) deposit protection limit. They propose increasing it from £85,000 to £110,000 for each person. This applies to each authorised bank, building society, or credit union.
If the change goes ahead, it will apply to any eligible deposits if a bank were to fail on or after 1 December 2025.
Why is the limit increasing?
The current £85,000 limit has been in place since 2017. Over time, inflation has chipped away at what that amount is worth in real terms. By the end of 2024, the real value of £85,000 cover has dropped because of inflation. This amount is about £113,669 in today’s money (PRA consultation).
The PRA’s proposed increase to £110,000 brings back much of that value. It also gives a simple, easy number for people to remember and plan around.
Right now, financial institutions fully protect around 97% of depositors. With the new limit, this will rise to about 99%. This means that even more people will feel secure that their savings are fully protected (Bank of England announcement).
Temporary High Balance protection is also going up
Some life events can give you a lot of money, for a short time. For example, selling your home or receiving an inheritance can do this.
For these situations, the FSCS offers Temporary High Balance (THB) protection for up to six months. The PRA wants to increase this limit from £1 million to £1.4 million. This change will help keep more money safe during important life events.
What the new FSCS limit means for you:
- More of your money is protected – The increase means fewer people will have savings above the protected limit.
- Peace of mind when planning – The £110,000 figure is clear and easy to keep in mind.
- Extra cover for significant life events – The THB rise offers more breathing room to hold a large sum temporarily.
- Flexibility with where you save – It is still smart to spread savings across different providers. However, this change allows you to keep more funds in one place with added protection.
When could this happen?
The PRA’s consultation ran until 30 June 2025, with the final decision expected in November 2025. If approved, the new limits would come into effect 1 December 2025 (PRA).
Banks, building societies, and credit unions will then have until 31 May 2026 to update their customer materials with the new figures.
In summary
This is a positive step for savers. Raising the FSCS protection limit keeps more of your money safe. The increase will help restore the real value of that safety net. This change offers more reassurance for both everyday balances and larger, temporary amounts.
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