Bank Accounts After Brexit - One Year Later
It’s been almost a year since the United Kingdom made its departure from the European Union, but there are still questions about how its relationship with its former partners will work. What is the story with banking after Brexit?
We’ve decided to examine what we know, answer outstanding questions and share some suggestions about how you can plan for possible changes in the future.
Is my money safe in the bank after Brexit?
This may be your principal concern when considering how to manage your money. Although the United Kingdom is formally out of the European Union, there will be no change to your account protections.
In the meantime, here are some things to know about your current account back in the United Kingdom:
The Financial Services Compensation Scheme (FSCS) covers all British current and savings accounts, as well as any Individual Savings Accounts you may have in credit unions, banks or building societies.
The Bank of England increased the deposit guarantee to £85,000 per UK-regulated financial institution following the pound’s fall after the initial Brexit referendum results in early 2017.
If you work with a foreign bank, however, there are temporary covers, such as the £1 million significant life event protection to cover inheritance, redundancy, and more, should your savings provider go bankrupt.
If you have accounts in sister banks that belong to the same financial institution, those accounts would only have the £85,000 cover.
If you feel more at ease with this guarantee and would prefer to have your savings in cash, an option would be to put your savings into bonds with a guaranteed fixed rate to maintain stability.
UK Bank Account After Brexit
Although you are still allowed to have an account in British banks after Brexit, you might have seen that regulations or fees have changed, complicating the process for you. In addition, more and more banks are leaving the UK in favour of EU banks, given that changing banking regulations in the UK have made EU banking options more attractive for patrons.
Banks after Brexit
For many, the process of having a bank account in a different country was significantly complicated after the UK officially left the EU. However, there are some non-UK personal banking options available to you.
You can open a bank account abroad; or, another alternative is an offshore bank account. Why should you consider the offshore option? Well, EU bank accounts opened after Brexit will have residency restrictions imposed, except those created explicitly for non-residents. While some EU banks will let you open an account with a passport, you may have to maintain a minimum deposit threshold or pay for a policy to avoid added fees.
In addition, offshore accounts in a reputable jurisdiction will allow you to protect yourself from the potential instability that could come from changing Brexit regulations or a volatile market as the account would benefit from a stable exchange rate.
Many offshore banks also allow you to hold a balance in multiple currencies. If you’re interested in opening an offshore bank account, there are some criteria you should keep in mind when picking the right bank for you.
With the help, advice and connections offered by Europe Emirates Group, those possibilities are ready today.
CEO, Europe Emirates Group