Protection for Business Bank Accounts?

[Whiskychaser]

Apologies if this has been discussed before (couldn't find on search), but does anybody know what protection exists for small businesses in the event of a banking collapse?

I know that personal deposits up to £35K are covered through the FSA compensation scheme, but is there anything similar in place for small businesses, should a bank go under?

I'm not naturally a paranoid person, but I'm wondering if I should re-think my strategy of letting money build up in the ltd. co. account!

Thanks in advance!

[Archangel]

Small businesses are also covered.

[TykeMerc]

It's a sensible question considering how many of us operate.

I looked into this too and the compensation scheme appears to cover all accounts, currently to £35k with a proposal for that to increase to £50k in the not too distant future.
Don't forget that's £35k per insured institution and large banking groups tend to be registered as a single institution so if you have money in RBS, NatWest and One Account it's all effectively in the nsame institution I believe. Moneysavingexpert.com has a list of linked banks on it somewhere and pretty thorough advice on this matter.

[contractor79]

so anything above 35k is at risk?

[Ruprect]

A mate of mine has opened an account with Northern Rock (no tulip) - underwritten by the government now.

[Archangel]

A mate of mine has opened an account with Northern Rock (no tulip) - underwritten by the government now.

The problem with NR business account is that its postal. I like this new fangled interweb thingy.

[Archangel]

so anything above 35k is at risk?

Yep, spread that dosh around. I've just opened a HBOS account (5.25% gross for first year). Already have RBS and Alliance & Liecester (apparently in bad shape, but ho hum).