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Understanding
FSCS Protection
FSCS protection safeguards up to £120,000 of your money if a bank fails. This guide explains how it works, which digital banks are covered, and how it differs from safeguarding at e-money institutions.
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What Is FSCS Protection?
FSCS (Financial Services Compensation Scheme) is the UK's statutory deposit protection scheme. It protects eligible deposits held with authorised banks, building societies, and credit unions if the firm fails.
If your FSCS-protected bank collapses, the FSCS automatically compensates you — you do not need to apply, and you do not need to chase anyone. The process is automatic and free.
Why Does FSCS Exist?
FSCS exists to maintain trust in the UK financial system by ensuring customers do not lose protected deposits if a bank becomes insolvent.
It helps prevent bank runs, increases financial stability, and provides public reassurance that eligible deposits up to £120,000 are protected.
How the £120,000 Limit Works
The FSCS protects up to £120,000 per person, per authorised bank. Joint accounts receive £170,000 protection because the limit applies per individual.
Some banking brands share a single banking licence. In these cases, the £120,000 limit is shared across all brands under that licence.
Are Digital Banks FSCS Protected?
Some digital banks hold a full UK banking licence and are 100% FSCS protected.
Others operate as e-money institutions. These firms do not use FSCS — instead, they use 'safeguarding', which protects your money differently.
FSCS vs Safeguarding (Important Difference)
FSCS protects deposits if a bank fails. Compensation is automatic and fast.
Safeguarding (used by e-money providers) keeps your money in ring-fenced accounts, but there is no guaranteed compensation and no £120,000 protection.
What Happens if a Bank Fails?
If your FSCS-protected bank collapses, the scheme typically pays out protected balances within 7 days.
You do not need to file a claim — the compensation is triggered automatically using bank records.
Joint Accounts & FSCS Protection
A joint account receives up to £120,000 protection (£120,000 per account holder).
Each person also keeps their own £120,000 protection for personal accounts in the same bank.
Which Digital Banks Are FSCS Protected?
Below is a quick summary of FSCS coverage for major UK digital banks. Always double-check with the provider and the FCA register.
How To Check If Your Bank Is FSCS Protected
Check the FCA Register to confirm whether the firm has a UK banking licence.
Look for the phrase: 'This firm is authorised by the PRA and regulated by the FCA.'
FSCS Protection by Bank
| Bank | FSCS Protected? | Type | Notes |
|---|---|---|---|
| Monzo | Yes — FSCS Protected | UK Bank | Full UK banking licence. |
| Starling Bank | Yes — FSCS Protected | UK Bank | Full UK banking licence. |
| Chase UK | Yes — FSCS Protected | UK Bank | Backed by JPMorgan Europe. |
| Tandem | Yes — FSCS Protected | UK Bank | Fully authorised PRA/FCA bank. |
| Atom Bank | Yes — FSCS Protected | UK Bank | Savings protected to £120k. |
| Zopa Bank | Yes — FSCS Protected | UK Bank | Became a bank in 2020. |
| Kroo | Yes — FSCS Protected | UK Bank | New UK bank licence (2022). |
| Revolut | No — Safeguarded Funds | E-Money | Not FSCS protected in the UK. |
| Monese | No — Safeguarded Funds | E-Money | Uses safeguarding, not FSCS. |
Compare FSCS-Protected Banks
View detailed reviews of UK digital banks with full FSCS protection.