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We’ve had several enquiries about concerns around personal funds being held in one bank and whether people are covered by the governments deposit guarantee.
Whilst we can’t instruct on where you should keep your funds, we’d like to highlight that the Financial Claims Scheme (FCI) exists and that it provides protection to deposits in banks, building societies and credit unions, otherwise known as Authorised Deposit-taking Institutions (ADI’s), and to policies with general insurers in the unlikely event that one of these financial institutions fails.
The FCS can only come into effect if it is activated by the Australian Government when an institution fails. Once activated, the FCS will be administered by the Australian Prudential Regulation Authority (APRA).
The FCS applies to deposits held with ADI’s, and is limited to $250k per ADI.
A few key points:
- The Australian Government guarantee’s deposits up to $250k held in ADI’s
- This is to reassure consumers should something happen to the bank then their savings will be repaid to them by the government
- This is limited to $250k per ADI
- Be aware that some banks brand themselves under different names. So if you chose to transfer funds to another ADI, check that that you are not moving to a bank that is ultimately still a branding of your original ADI
- Example: St George, RAMS, Bank of Melbourne & BankSA are all owned by Westpac
For those with funds in excess of $250k held in a single ADI and who wish to make a transfer, we’re able to assist in recognising related ADIs and assisting with in the transfer process.
Don’t hesitate to contact us if you have concerns, we will work with you find the information you need and guide you to find a right solution.
