On 18 November 2025, the Prudential Regulation Authority (PRA) published a policy statement (PS 24/25) setting out final rules in relation to increasing the Financial Services Compensation Scheme (FSCS) deposit protection limits.

Background

The FSCS is the UK’s deposit guarantee scheme, which protects eligible deposits by providing compensation to depositors if a firm fails. The PRA consulted in March 2025 (CP 4/25) on proposed amendments to the depositor protection framework, in particular in relation to the level of protection available for depositors from the FSCS.

Key changes

  • Deposit protection limit: The PRA confirmed that the deposit protection limit will be increased to protect up to £120,000 if a depositor’s bank, building society or credit union fail. The PRA highlighted that this is an increase from the current limit of £85,000 and is a more significant increase than the £110,000 limit proposed in CP 4/25.
  • Temporary high balance (THB) limit: The PRA also set out that, as proposed in CP 4/25,the THB limit will be increased from £1 million to £1.4 million.
  • Other amendments to the depositor protection part (DPP) rules, supervisory statement (SS) 18/15, and statement of policy (SoP) 1/15 : The PRA have made some clarificatory changes to the DPP rules and SS18/15, in particular in relation to the information sheet that firms are required to send to depositors and the information to be displayed in branches. The PRA also set out that SoP 1/15 will be changed to reflect the updated depositor protection rules.
  • Implementation date and transition period: The PRA confirmed thatfirms will have a six-month period, until 31 May 2026, to update disclosure and deposit compensation materials in relation to these changes. However, firms will be required to update their single customer view systems to reflect the new limit from 1 December 2025.

Next Steps

The PRA confirmed that the new deposit protection and THB limits will apply in relation to firm failures occurring on or after 1 December 2025. The PRA also highlighted that the FSCS will make information available on its website to help firms in relation to the new limits and information requirements.