FSCS Launches Poster Campaign To Raise Awareness Of Scheme For Safeguarding Savings

Will A Sticker Be Enough To Cover Your Money?

A determined Mark Neale has disregarded concerns that a new campaign to reassure customers their savings are safe will not be enough to restore consumer confidence.

From Friday 31 August, UK authorised banks, building societies and credit unions will have to explicitly tell customers their savings and deposits are protected by the Financial Services Compensation Scheme (FSCS).

They will do this by putting posters and stickers in branches, as well as information on their websites.

In addition, UK branches of foreign banks from the European Economic Area have to specify that their customers are not covered by FSCS and clearly state which national scheme provides protection.

This action follows the introduction of new FSA rules obliging deposit takers to display information about FSCS protection available to consumers.

Speaking to The Huffington Post UK, Neale said there was no need for the consumers to be cynical about the FSCS since nobody has ever lost a penny of insured deposits, "and nobody ever will".

"This campaign will be powerful as it's not the only thing that we're doing to raise awareness," said Neale, adding that a further marketing push was due to take place at the turn of the year.

This will focus on engaging with consumers about life style events, such as buying a house or getting married that may lead consumers to take out new financial products.

The 2013 campaign will predominantly use radio and print advertising, after a television campaign using clay stop-motion characters had not effectively "cut through to consumers in the way that we wanted".

Remember him? No?

Neale also said the FSCS had looked to the US and its policy of asking banks and building societies to display stickers about the FDIC - the Federal Deposit Insurance Corporation, which covers each customer to at least $250,000 (£158,000) per insured bank.

"There isn't just one way to achieve our objective, but putting posters up and messages on websites is powerful; in the US everyone knows about the FDIC because of the stickers they display," Neale said.

In the UK, the FSCS protects consumers if banks, building societies or credit unions go bust. Since 2001 it has helped more than 4.5m people and paid out more than £26bn.

It covers the full range of financial services and is paid for by a levy charged at financial institutions, intermediaries and advisers each year.

The total levy has doubled in recent years as a result of the banking crisis, from £131.7m in 2008-09 to £265m for 2012-13.

Peter Tyler, director of the British Bankers' Association, said: ‘‘It is important for customers to understand the protection arrangements which apply to their deposits, whether provided by FSCS or an overseas scheme.

"The highly visible posters and stickers in branch from today will help to inform customers in this regard and provide assurance that their money is safe.''

And Hilary McVitty of the Building Societies Association, said although a great number of building society customers were already confident their money was safe, the posters will reinforce that confidence and boost their knowledge of the compensation limits.

The campaign arrives at a difficult time for banks and the issue of trust; the five-year anniversary of the Bank of England's announcement that it would provide emergency aid for Northern Rock is on 13 September.

And today, the Treasury Committee called on RBS and Lloyds TSB to allow basic current account customers to use rival banks and institutions cash machines, arguing that to do otherwise would penalise the most vulnerable members of society.

Barclays, HSBC and Santander have already made a public commitment to continue to provide basic bank holders with unrestricted access to cash machines.

The Treasury Committee will now write to the other providers of basic bank accounts asking for similar clarification.

Gillian Guy, chief executive at national charity Citizens Advice, said the Treasury Committee was right to call on RBS and Lloyds TSB to treat all of their customers fairly.

"It costs to be poor. RBS and Lloyds TSB are treating basic bank accounts customers like second class citizens," he said.

"Stopping them using other cash machines can force the poorest to pay to get their money - through travel costs, using ATMs that charge or buying something in a store so they can get cash back."

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