Understanding Your Holding Account
When you open a savings account with us, your funds are first sent to our custodian, Bondsmith. Bondsmith is responsible for holding your funds in a secure account until they are ready to be processed into your chosen savings product. In this article, we will explain what a holding account is and how it works.
What is a Holding Account?
A holding account is a temporary account where your funds are held before they are transferred to your chosen savings product. This account is provided by our custodian, Bondsmith, and is held with HSBC Bank Plc.
Why Do I Need a Holding Account?
The purpose of a holding account is to ensure the security of your funds. By holding your funds in a separate account, we can protect them from any potential risks or issues that may arise. This also allows us to process your funds into your chosen savings product more efficiently.
What is the Financial Services Compensation Scheme (FSCS)?
The Financial Services Compensation Scheme (FSCS) is a UK government-backed insurance scheme that protects your savings in the event that a bank or financial institution fails. This means that if the bank holding your funds goes bankrupt, you may be eligible to receive compensation for up to 85,000.00 GBP.
How Does the FSCS Work with My Holding Account?
Since your holding account is held with HSBC Bank Plc, it is covered by the FSCS insurance for up to 85,000.00 GBP. This means that if HSBC Bank Plc were to fail, your funds in the holding account would be protected by the FSCS.
What About My Chosen Savings Product?
Once your funds have been processed into your chosen savings product, the bank providing that product will also provide FSCS insurance for your funds. This means that your savings will continue to be protected by the FSCS, even after they have been transferred out of the holding account.
In Conclusion
In summary, your holding account is a temporary account provided by our custodian, Bondsmith, to ensure the security of your funds. It is held with HSBC Bank Plc and is covered by the FSCS insurance for up to 85,000.00 GBP. Once your funds are processed into your chosen savings product, the bank providing that product will also provide FSCS insurance for your savings. This means that your funds are always protected by the FSCS, giving you peace of mind while you save with us.