The PRA’s policy statement on changes to the Financial Services Compensation Scheme (FSCS) deposit protection framework has now been published in PS 24/25. This sets out that the deposit limit will be increased from £85,00 to £120,000 and the limit for temporary high balances (THB) will be increased from £1 million to £1.4 million in relation to firm failures occurring on or after 1 December 2025. 

These will be significant changes for both the FSCS and depositors, but the most significant changes for Firms relate to information and disclosures, requiring changes to be made both now and over the next six months.

Here are five key takeaways for firms:

1. Single Customer View: The PRA confirmed that Firms will be required to update their single customer view (SCV) systems – the system that provides information to the FSCS about depositor’s eligible deposits so that depositors can be quickly compensated - from 1 December 2025 to reflect the new limits. In particular, the PRA reminded firms that they will need to be ready to adjust the SCV system to reflect the changes on that date and should also ensure that relevant contact details on the system are up to date.
2. Updated information sheet: Firms are required to provide an information sheet to depositors in relation to FSCS cover in certain circumstances, the PRA is requiring that amendments be made to this information sheet to reflect the new deposit protection and THB limit and to ensure it remains clear and up to date. Firms must provide updated information sheets ‘soon as practicable’ after the new limit comes into effect, and in any event by six months after that date. Accordingly, while firms are not expected to ‘proactively’ notify customers, they are expected to provide the required disclosure information within six months. The PRA encourages firms to provide depositors with the updated Information Sheet as soon as possible within the six months, to minimise the risk of confusion.
3. Compensation sticker and compensation poster: Firms are also required to display a compensation sticker or compensation poster in certain circumstances, including in branches and online; the PRA is requiring that changes are made to these materials to ensure that they refer to the proposed new deposit protection limit.
4. Changes to the exclusions list: Firms are also required to provide depositors with an exclusions list, setting out when a deposit is excluded from protection, in certain circumstances; the PRA is requiring amendments to simplify and clarify certain of the exclusions included in this list to make this clearer for depositors.
5. Transitional period for changes to disclosure materials: For such disclosures and deposit compensation information the PRA confirmed that, while it encourages firms to do this as soon as practicable after the new limit comes into effect, there will be a transitional period to 31 May 2026 to allow Firms to make these changes to its disclosure materials and provide the required updated information to depositors.

In short, this means that having updated the SCV in advance of the 1 December deadline, Firms will then have up to six months (until no later than the 31 May 2026) to amend and provide revised disclosures. 

If you would like to discuss these requirements, or any aspect of the new rules, our London Financial Services team can support you in making these changes.