13th July 2010
The proposal of a new Europe-wide compensation scheme minimum limit of £83,650 (€100,000) in the event of a bank failure should be good news for beleagurered savers.
The new rules which will apply from 2012, if the move is approved by MEPs and finance ministers, is a significant rise from the current £50,000.
The European Commission is also hoping to see money returned to depositors in just seven days if a bank fails, a big change from the current three month minimum.
The EU proposal represents a substantial rise in the amount available and should in theory cover the European Economic Area, so would encompass Norway, Iceland and Lichtenstein. The Commission says the move will protect at least 95% of savings on deposit across Europe. The Commission also believes it will give people the confidence to select banks from across the EU.
Some of the comment boards express a degree of worry that the exchange rate could reduce the amount available in the UK. However it is likely a local system with a set amount in sterling would be put in place.