Savers in Scotland are heading down a corridor of uncertainty, as institutions are unable to confirm how safe their deposits will be if the country votes for independence.
Some have already shown their hand, with banking giants Royal Bank of Scotland and Lloyds Banking Group saying that they will register themselves in England if the Scots vote for independence.
But on the whole, contingency plans appear to be on hold, as the financial services industry nervously awaits the outcome of next week’s referendum.
Scots and the FSCS
Most pressingly for consumers, it is not entirely clear what the protocol will be for the protection of Scottish savers through the Financial Services Compensation Scheme.
Currently, the scheme insures savers for the first £85,000 of their deposits per person per institution. The necessity of such a scheme was emphasised by the near-meltdown of the Co-operative Bank just last year. (Find out more in our guide to the FSCS.)
Secure Savings Video
The organisation has just launched its ‘Protecting Your Future’ campaign, featuring Fearne Cotton., which is reassuring people that their money is protected.
Mark Neale, the scheme’s chief executive, said that consumers who are aware of the FSCS are more confident in pressing ahead with financial products.
“FSCS plays a vital role in building and sustaining consumer confidence, which in turn benefits the industry,” he says.
It is strange, then, given its insistence on confidence, that the FSCS is not yet prepared to speculate on what the referendum might mean for consumers.
It has merely reiterated the legal stance: that the EU requires countries in the EU to provide a deposit scheme (currently €100,000), and that there is ‘likely’ to be a transitional period while formalities are decided.
“During any such period, we expect consumers will continue to be protected by the FSCS as at present and compensation cover would continue unaffected,” is the line coming from the organisation.
So, what’s the plan?
As yet, it doesn't appear there is one.
Such a message from the FSCS may deter some from migrating their cash immediately south of the border, but the lack of long-term certainty about the security (or value) of savers’ deposits at this stage may not prevent those with a nervous disposition from shifting their cash at first opportunity.
All that is clear right now is that most are sitting, poised, awaiting the outcome of the referendum.
For even with that decided, the future of the financial services industry for those north of the border remains decidedly uncertain.