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<p>The Deposit Guarantee Scheme Directive (DGSD) is a single market measure to ensure
that depositors are entitled to the same level of protection wherever they deposit
their money, and that UK firms are not competitively disadvantaged in relation to
firms in other European Economic Area (EEA) jurisdictions.</p><p>As a result of the
recent strength of the pound in relation to the euro, it was necessary for the Prudential
Regulation Authority (PRA) to review the sterling coverage limit. On 31 December 2015,
the FSCS coverage limit changed to £75,000 per person, per authorised firm. The vast
majority of UK depositors are not directly affected – more than 95% of depositors
are still fully protected by the FSCS after this change.</p><p>The Government brought
forward legislation to ensure that the deposit protection limit was maintained at
£85,000 until 31 December 2015, to ensure those depositors affected had the time to
be informed of the change and to take any actions they felt appropriate. In addition,
the PRA made new rules to ensure that, until 31 December 2015, depositors with more
than £75,000 worth of deposits at a single authorised firm could withdraw those deposits
without penalty.</p><p> </p><p>The Government has made representations to the Commission
to suggest that the reviews of the coverage level in non-euro states should occur
after the Commission completes its review of suitability of the coverage level as
a whole and also that changes for non-euro states reflect genuine, very large and
lasting changes in exchange rates.</p>
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