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FSCS gets deposit protection checker

The Financial Services Compensation Scheme (FSCS) has unveiled a new consumer-facing online tool which tells investors the degree to which their savings are protected.

The Scheme, funded in part by an annual levy of £78m from investment advisers, has launched the tool in response to research showing that barely half of consumers are aware that compensation is available when authorised firms fail.

Users who enter the name of their bank, building society or credit union along with the level of savings will be told instantly whether their savings are protected. The tool is to be promoted through a nationwide radio, print and online advertising campaign. This follows a series of TV ads that aired last year.

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The FSCS hopes some providers will promote the protection checker, although obviously that would only alert consumers with banks that were covered rather than those who need to be alerted to a shortfall of cover.

Danny Cox, head of financial planning at Hargreaves Lansdown, said the tool could also benefit from price comparison sites linking to it.

Overall, the success of the scheme will depend on user take up, but Mr Cox was upbeat. “Despite being a bit of a gimmick it should help people to engage,” he said.