The Financial Services Compensation Scheme and how your money is protectedWhat is the Financial Services Compensation Scheme (FSCS)?
The Financial Services Compensation Scheme (FSCS) pays you compensation when a UK financial firm goes out of business and cannot pay you your money.
It is independent of the government and the financial services industry and is free to use.
How does the FSCS work?
In the unlikely event that a UK bank should fail (and you lose your money) you won’t need to do anything. Your claim will be automatically processed and the FSCS will pay you back as soon as possible.
Important:
The maximum amount covered by the FSCS is £85,000 per person, per banking licence (a single licence may cover several banks with different names who are owned by the same company). No banks on the current panel share a license and it will be made clear if two banks share a license going forward.
If you have more than one account with the same bank (or another bank under the same banking licence), either on or outside of the CashHub, the total compensation available to you is £85,000.
If you hold more than £85,000 with the same bank/banking licence, you will not receive compensation on any savings above this amount.
If you have a large sum to save, or the deposit plus the interest earned could easily amount to more than £85,000, you should consider spreading your savings across several banks under separate banking licences to ensure each deposit is fully covered by its own separate £85,000 compensation.
For savings held through an online service such as the CashHub the FSCS may take longer than seven days to pay the compensation, up to a maximum of three months.
How does the FSCS apply to CashHub holdings?
- The savings accounts: all of the savings accounts available on the CashHub are protected by the FSCS.
- The holding account: any money in the holding account is held in trust by Bondsmith Savings Nominees Ltd in a segregated bank account. This is also protected by the FSCS and the same important information above applies
What if Bondsmith fails?
Should Bondsmith fail, any money in your holding account is held in a segregated account (separate from company funds) and cannot be accessed by creditors of Bondsmith. There is no limit on the amount protected in this scenario.
However, the insolvency practitioners could deduct their fees from money in the holding account if there are no other sources available. These costs would be divided equally among all customers.
It may take longer to get your money back in this scenario than if it were held directly a bank.
Fixed term accounts
Any money you deposit into a fixed term account is locked into the account for the length of the term and normally you cannot top up or withdraw money before the end of that term.
Important:
Before you apply for a fixed term account you should be sure that you can afford to lock your savings into the account for the length of your chosen term with no access until that term has ended.
Some banks may allow a withdrawal before the end of the term, but normally only in exceptional circumstances (such as severe illness) and this may incur a penalty fee.
Important:
If you apply for a fixed term or notice period product and the interest rate is replaced before the account is opened your money will not be deposited. It will be held in the holding account. We will contact you if this happens.
If the rate increases before the account is opened Bondsmith may, at their discretion, deposit your money.
Important things you need to consider
The bank/building society you choose
The banks/building societies available on the CashHub must meet the minimum criteria set by both BondSmith and Quilter to be included, but you should also ensure that you are happy to place money with a particular bank or building society.
Independent credit ratings provide a guide to the financial strength of a bank/building society, but please note that ratings are not always available and are not a guarantee that your money is safe.
You can generally find the credit ratings (where available) on the bank/building society’s website.
Important:
The inclusion of a bank/building society on the CashHub does not constitute a recommendation or guarantee of financial safety.
Before you apply for a savings account you should be sure that you are happy with the bank/building society that you have chosen.
Interest rates available outside of the CashHub
The savings accounts available on the CashHub are chosen to provide competitive rates of return, but you may find savings accounts with higher rates of interest elsewhere.
Before you proceed make sure you are happy with the rate of interest on your chosen CashHub savings account and/or that you are happy to proceed without comparing other providers.
Transferring money into and out of the CashHub
You must use your nominated bank account to pay money into the CashHub or to receive withdrawals from a CashHub savings account. If a different account is used for a payment it will not be accepted and the money will be returned to the originating account.
Money in the holding account
The CashHub holding account is designed as a temporary home for your money while it is being deposited into, or withdrawn from, your savings account/s. After 90 days Bondsmith may, at their discretion, return money from the holding account to your nominated bank account.
You do not receive any interest from the holding account. Any interest paid on the holding account will be retained by Bondsmith. If you leave money in the holding account, you could be missing out on interest payments or growth from depositing the money in further savings or investment products.
If you pay less into the CashHub than the amount you chose to save in a savings account, the money will remain in the holding account.
If you pay more into the CashHub than the amount you chose to save in a savings account, only the amount you chose to save will move to a savings account. Any money above this amount will remain in the holding account.
Important:
The maximum FSCS compensation for the holding account is £85,000.
When a fixed term account matures the money (your deposit plus the interest earned) will automatically return to the holding account.
Any amount returned above £85,000, either from a single savings account or the total returned from several accounts maturing at the same time, will not be covered by the FSCS.
Verifying your identity
When you first set up your CashHub account Bondsmith will need to verify your identity. This is to satisfy Money Laundering Regulations and bank regulatory requirements.
Your identity check will be completed by Bondsmith. If for some reason they are unable to verify your identity, Bondsmith will contact you directly to request further information.
Tax
All interest is paid gross of any tax. We will provide you with a tax certificate each year showing how much interest you have received.
Important:
You are responsible for ensuring you pay the correct tax due on any interest received, taking into account your Personal Savings Allowance and personal circumstances.
Role and responsibilities
The CashHub is an online service provided by Quilter and powered by Bondsmith Savings Ltd, a provider of embedded savings and banking services to the wealth management and investment industry, and authorised by the Financial Conduct Authority under the Electronic Money Regulations 2011.
Quilter
We, Quilter Investment Platform Ltd (Quilter), are:
- distributing the CashHub via our online Customer Centre and the Quilter App
- providing customer support and servicing
We will handle your personal data in line with our Privacy policy, which you can find on our website.
Quilter Investment Platform Ltd is authorised and regulated by the Financial Conduct Authority with FCA authorised No. 165359.
Quilter Investment Platform Ltd registered in England and Wales at Senator House, 85 Queen Victoria Street, London, EC4V 4AB. Registration number 01680071.
Bondsmith
Bondsmith provide the technology that powers the CashHub. Bondsmith Savings Ltd is a provider of embedded savings and banking services to the wealth management and investment industry and is authorised by the Financial Conduct Authority under the Electronic Money Regulations 2011.
The CashHub is a ‘cash management platform’ or ‘savings marketplace’, an online platform which enable customers to deposit funds in savings accounts held with a number of banks or building societies.
Bondsmith is a trading name of Bondsmith Savings Ltd. Bondsmith Savings Ltd is registered in England and Wales, No 13223331. Registered office: 124-128 City Road, London, EC1V 2NJ.
Bondsmith is authorised by the Financial Conduct Authority under the Electronic Money Regulations 2011, Firm Reference 955601, for the issuing of electronic money.
Important:
Quilter:
- The CashHub is distributed by Quilter.
- We do not hold any money deposited through the CashHub.
- We provide customer support and servicing.
Bondsmith:
- The CashHub is a Bondsmith product
- Money in the holding account is held in trust by Bondsmith Savings Nominees Ltd in a segregated bank account.
- the holding account is also protected by the Financial Services Compensation Scheme (FSCS).
- Money in the savings account/s is held in trust by by Bondsmith Savings Nominees Ltd in the bank or building society of your choice.
The charges
You will not be charged directly if you use the CashHub.
You do not need to pay a fee or charge directly to Bondsmith or Quilter for your CashHub account.
Bondsmith are paid directly by the Savings Account provider. This is up to 0.25% of the account values held with the Savings Account by the trustees. It is deducted from the interest rates before they are displayed to you so that the rate on the CashHub is the rate you will receive. Bondsmith will also retain any interest paid on the holding account. You do not receive any interest from the holding account.
Bondsmith pay Quilter a distribution fee of up to 0.15%.
Cancellation and closure
Cancelling or closing your CashHub account
When you first apply for a CashHub account you have 30 days to cancel it. The 30 days begin from the date the email to confirm the account has been set up is sent.
After the initial 30-day cancellation period has elapsed you can close your CashHub account at any time.
If you have already deposited money into a savings account with a notice period or fixed term, your savings will be returned after the notice period elapses or the fixed term account matures, at which point your CashHub account will also be cancelled or closed.
Important:
In exceptional circumstances it’s possible for Bondsmith to close your CashHub account.
You would be given a minimum of 30 days notice should this occur.
At the point of closure the total value of your account would be paid to your nominated bank account. However, if you hold money in a savings account with a notice period or fixed term, your savings will be returned savings after the notice period elapses or the fixed term account matures, at which point your CashHub account will also be closed.
Cancelling a savings account
Easy access and notice accounts can be cancelled within 14 days of account opening.
Generally, fixed term accounts will not have cancellation rights. If you want to cancel a fixed term account, you will have to wait until the end of the term to receive your money.
Important:
Before you chose a fixed term account you should be sure that you can afford to lock your savings into the account for the length of your chosen term with no access until that term has ended.