Savers with accounts at Santander and Alliance & Leicester see their compensation halved
As of 28th May, savers who have accounts with both Santander and Alliance & Leicester will have protection for just £50,000 of their savings rather than the £100,000 they currently enjoy.
Santander has owned Alliance & Leicester since 2008 but the two banks kept their separate banking licenses and Financial Services Compensation Scheme (FSCS) protection. So a saver with an Alliance & Leicester account and a Santander account had £50,000 of FSCS cover for each account. But following a restructure Alliance & Leicester deposits will fall under Santander’s license which means that only £50,000 of their savings will be protected by the FSCS.
10,000 savings customers affected
Santander says that it has 14 million savings customers and that this will affect around 10,000. It will write to all those affected and fully explain the changes and their options.
Melanie Green, Principal Researcher at Which? said: ‘If you have savings with Alliance & Leicester and Santander remember that from the end of May only £50,000 will be covered by the FSCS in the event that Santander went bust. Take a look at how much you have saved and consider switching some to a different bank or building society’.
Our explains how the FSCS scheme works and which banks and building societies share licences. If you’re looking to switch some of your savings to a new provider try our savings accounts finder which helps you find the best account for you.
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