UK Financial Services Compensation Scheme outlines levy distribution across firms for 2019/20

Maria Nikolova

The bulk of levy payers, 59%, will pay less than £50, whereas over 4,500 firms will not pay any levy.

The UK Financial Services Compensation Scheme (FSCS) has today published indicative numbers on how its levy will be distributed across firms in 2019/20.

Of the 46,000 firms to pay FSCS’s levy this year, the majority of levy payers, 59%, will pay less than £50. Over 4,500 firms will not pay any levy, instead they will each receive an average rebate of £139.

In contrast, the top 110 firms, comprising 0.2% of the total levy paying population, will pay an average of £3 million, nearly 61% of the total levy bill.

These are the current forecasts for FSCS’s 2019/20 levy figures, although, as in past years, it may be necessary for FSCS to raise additional levies.

Caroline Rainbird, FSCS CEO explains,

“The levy enables FSCS to protect thousands of people each year who have nowhere else to turn when financial service firms fail. Our staff focus on the need for value for money, whilst working hard to deliver an effective and empathetic service to customers, many of whom are in a really tough place. Their professionalism also helps to restore consumer confidence in the financial services industry.

“To reduce costs to levy payers we pursue recoveries from the estates of failed firms, and in 2018/19 we recovered £26 million. We also believe that our strategy, FSCS into the 2020s: Protecting the Future will help to further reduce future levies. It focuses on four pillars, Prepare, Protect, Promote and Prevent. As we continue to see a rise in SIPP related claims we are working with our partners in industry through our Prevent pillar to gain valuable insight into the causes of firm failures and about the directors and advisors involved in mis-selling.”

FSCS’s 2018/19 Annual Report shows the Scheme paid a total of £473 million in compensation to 425,760 customers of failed firms during 2018/19. This amount compares with the £405 million FSCS paid in compensation in the previous year. FSCS’s Report also shows the body raised levies on 49,224 regulated financial services firms, with a total levy income of £517 million, to fund the costs of compensation and of running the Scheme.

Read this next


Is the Bank of England facing another storm? Op-Ed by Stuart Cole, macro economist at Equiti Capital

An analysis and opinion editorial by Stuart Cole, macro economist at Equiti Capital, 3 October 2022 on what triggered the UK gilt market sell-off and is the Bank of England facing another storm?

Industry News

Kim Kardashian fined $1 million for touting EMAX tokens on social media

“Investors are entitled to know whether the publicity of a security is unbiased, and Ms. Kardashian failed to disclose this information.”

Retail FX

INFINOX launches IX Exchange platform with +20,000 markets in UK

“The launch of IX Exchange is a statement of intent for our growth strategy and a game-changer for our clients’ trading potential.”

Retail FX

Saxo issues gloomy report for Q4 2022 and beyond

Globalisation was the biggest driver behind low inflation over the past 30 years and instrumental for emerging markets and their equity markets. Globalisation in reverse will cause turmoil for trade surplus countries, put upward pressure on inflation and threaten the USD as the reserve currency.

Executive Moves

ICE appoints Caterina Caramaschi to oversee interest rates and equity derivatives

“As the head of a product set covering some of the biggest interest rate and equity derivative benchmarks, at a time when investor’s priorities are firmly focused on interest rate changes and the outlook for global economies, Caterina’s two decades of financial market experience, and the relationships cultivated during that, will be invaluable in developing these products to the benefit of our customers.”

Retail FX

Plus500 sponsors Chicago Bulls ahead of trading platform launch in United States

Plus500 has signed a major multi-year sponsorship deal to become an official global partner of iconic NBA team Chicago Bulls. 

Technology adds stock options APIs to market data platform that includes FX and Crypto has launched a new set of stock options APIs to its entirely self-serve real-time data APIs, which includes stocks, crypto, forex, and options APIs free to use.

Market News

What’s in store for markets this week!

After The UK government unveiled their top tax rate cut, setting fire to GBP Cross pairs, prompting an intensive sell-off on the cable


FinanceFeeds Podcast Ep. #7: Exness’s Elena Krutova shares how to recruit the best talent in FX

FinanceFeeds is delighted to announce the release of the FinanceFeeds Podcast’s seventh episode featuring Elena Krutova, Chief People Officer of Exness, the renowned FX and CFD broker headquartered in Cyprus.