Is my business eligible for FSCS protection? Your guide to coverage in 2025

Are your business savings protected if the worst happens to your bank? 

It is a question more business owners are asking, especially as interest rates changes and balances grow. The Financial Services Compensation Scheme (FSCS) offers vital protection, but not every business is automatically covered. 

This guide breaks down who is eligible, what to look out for, and how to make sure your deposits are covered. 

Let’s dive in!

What is FSCS protection and who is it for? 

The Financial Services Compensation Scheme (FSCS) protects eligible deposits if a UK-authorised bank, building society, or credit union fails. It covers up to £85,000 per eligible business or person, per institution. 

Many business owners wrongly assume it only applies to personal savings. Business accounts can be protected too, but there are rules around who qualifies and how accounts are set up.

Whether you are covered depends on your business structure, the bank you use, and how your account is registered. It is not automatic, so it is worth checking.

Is your business type covered?

Limited companies 

Most limited companies are eligible for FSCS protection if the account is held with a UK-authorised bank, building society, or credit union. The company must be registered in the UK, and the account needs to be in the company’s name. Each limited company is treated as a separate legal entity, so it gets its own £85,000 protection limit. 

Sole traders 

Sole traders are covered in the same way as individuals. FSCS protection applies up to £85,000 across all eligible accounts held with the same financial institution. That includes both business and personal savings, so it is important to keep an eye on total balances if you bank in one place. 

Partnerships 

Partnership eligibility depends on the type of partnership and how the account is structured. In some cases, partners may be treated individually, while in others the partnership is treated as one entity. It is best to ask your bank about how the account is classified and whether each partner gets separate protection. 

Charities, trusts, and clubs 

These groups may be eligible, but only if they meet FSCS criteria. The organisation must be properly registered, and the account must clearly identify the legal entity that owns the funds. If details are unclear or incomplete, claims made to the FSCS may be delayed or rejected. 

Public sector and large companies 

Public authorities and larger corporations are generally excluded from FSCS protection. The scheme is designed to support individuals and smaller businesses. Eligibility is often based on annual turnover, balance sheet size, and the number of employees criteria set by the Prudential Regulation Authority. 

What is not covered? 

FSCS protection has limits, and it does not cover every type of money or business account. Knowing where the scheme draws the line can help you avoid nasty surprises. 

• Business deposits over the current limit of £85,000 are not protected. If your business holds more than that with a single provider, anything above the threshold is at risk if the bank fails. 
• FSCS also does not cover things like investments, crypto assets, or general insurance claims. These fall under different compensation schemes or none at all, so it is important to read the fine print. 
• Finally, your business must be registered in the UK and your accounts must be with a UK-authorised bank, building society, or credit union. Accounts held outside the UK, or with firms that only have an electronic money licence, are not covered. 

How to check if your business is eligible 

It does not take long to check whether your business is protected, and it is well worth doing. 

Use the FSCS protection checker 

You can check directly at fscs.org.uk. Just enter your banks name to see if they are covered and what kind of protection applies. 

Ask your business bank

Speak to your bank to confirm how your account is registered. You can also ask for written confirmation that your provider is authorised and your account qualifies for FSCS protection. 

Double-check the register 

Look up your bank on the official list of Financial Conduct Authority and Prudential Regulation Authority authorised firms. Watch out for lookalike names, only the exact legal entity listed is protected by FSCS. 

Why it matters in 2025 

This year, FSCS protection is more important than ever, especially as business cash balances grow.

The Prudential Regulation Authority has proposed increasing the FSCS limit from £85,000 to £110,000 by December 2025. It is a response to rising inflation, higher interest rates, and the fact that many businesses are holding more money in their accounts than they used to. 

At the same time, the number of non-bank providers is growing and not all of them are covered by the FSCS. Without realising it, some businesses are moving their deposits into platforms that do not offer the same safety net. 

Checking your eligibility now is one of the easiest ways to protect your business from unexpected financial loss. A quick check today could save you a lot of stress tomorrow. 

We’ve covered more on FSCS protection in our article, FSCS protection: how it safeguards your business bank deposits.

Final thoughts 

FSCS protection offers valuable peace of mind, but it is not automatic for every business. Eligibility depends on the structure of your company, your provider’s authorisation status, and how your account is registered. 

Now is a smart time to double-check the details. With more businesses holding higher balances, and changes to protection limits on the horizon, making sure your savings are covered could prevent avoidable risk. 

If you’re looking for a secure place to grow your business savings, our Savings Pot — available through the Business Rewards Account could be the right fit. It offers FSCS protection, competitive interest rates, and the flexibility to manage your money with confidence.

Build financial confidence, one deposit at a time 

Our Savings Pot is an exclusive feature of our Business Rewards Account, giving you up to 4.33% AER (variable)* on your business savings, with monthly interest, instant access, and no account opening fees. 

It is backed by the support of a relationship manager who understands your business and can help you plan with clarity. 

This is savings done differently.

Open a Savings Pot linked to Allica’s Business Rewards Account to start making your money work harder for you. 

*Rate includes standard rate of 3.33% AER (minimum balance applies) plus a 0.5% boost each month if you make 15 bank transfers out of the account in the previous month, and a 0.5% boost for six months if you complete a switch with CASS. Rates correct as of 9th May 2025. ‘AER’ stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year. Subject to eligibility – see Savings Pot Key Product Information for more details.

Links were live and information was correct at the time of writing the article.

Disclaimer: This is information – not financial advice or recommendation

The content and materials featured in this article are for your information and education only, and are not intended to take into consideration any particular recipients’ financial situation. The product details and interest rates referred to are correct at the time of writing.

The information does not constitute financial advice or recommendation and should not be considered as such. Allica Bank will not accept any liability for any loss, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.