FSCS launches programme to boost awareness

The Financial Services Compensation Scheme (FSCS) has launched a programme to raise awareness of the role it plays and the protection it provides after research found that despite record payouts during the financial crisis there continues to be a lack of knowledge.

It found that the level of spontaneous awareness in 2009 fell to 9% from 20% in January 2008. Recent research suggests that spontaneous awareness of the FSCS remains low at 3% and that only 47% of people are aware of the existence of a compensation scheme. The research also shows that there appears to be a link between awareness of the FSCS and higher levels of consumer confidence.

The move follows a number of improvements and changes to the Scheme following the run on Northern Rock in 2007 and the bank failures of 2008. These include moving to a much quicker payout regime and a commitment by the authorities to boost awareness of the FSCS.

The campaign features Euan Mee, a character who represents all of us. He is busy and gets through life as best he can. Being human, he will sometimes take a short cut or park in the wrong place, but he is no rule breaker. He is no fool either and is naturally curious about all sorts of things. The character is used to bring home the message in a balanced tone that the FSCS exists, what it covers and how consumers can find out more information.

'The FSCS provides a vital function by helping to build consumer confidence, which contributes to financial stability. That is good for consumers and for the industry.  We are launching this campaign to make sure consumers know the FSCS and the protection it provides should an authorised financial services firm go bust. We want consumers to check how FSCS protection applies to their own individual circumstances and be reassured that their money is safe,’ said Mark Neale, chief executive of the FSCS.

‘The FSCS believes it is important that consumers know about the changes to compensation for savings accounts that were introduced on 31 December 2010. Protection levels increased from £50,000 to £85,000 and consumers will now be able to get their money within 20 working days in the event of a bank, building society or credit union failure,’ he added.

The programme is strongly supported by the Bank of England, HM Treasury and Financial Services Authority. It also has the backing of leading insurance companies, banks, building societies and independent financial advisor networks. The programme runs until the end of the financial year. The costs of the campaign were funded by the industry through the FSCS levy in 2009/10.