In the current climate is it worth/wise to have money deposited with different banks...even if it is less than the £50K covereverd by compensation?

[DraculaNeedsArteries]

Just pondering.

If a bank goes under I know that the first £50K per person per institution is safe under a compensation scheme.

But I assume those compensation schemes will take a while (weeks/months?) to pay out.

So if you have all of you current and savings with the same institution you could find yourself in a position where you have no liquid funds for a few days/weeks until next payday/benefits day/deposit/whatever.

Could you survive if you had no liquid funds until payday apart from what was in your purse/under your mattress?

TBH I don't think I am that worried by it. DP is paid cash and we could pile credit card up until funds were available....but is it something to think about?

What do you think?

Well I have distributed small chunks around various institutions for this reason.

Like I say I probably won't be doing it...besides I haven't heard my bank's name come up as a risky one (yet).

I just thought about it today - your money may be safe with them...doesn't mean that it will be accessible if a bank collapses.

I am not talking about savings Riven.

I am talking about your day to day spending money. The stuff you pay debit cards out of. The stuff you draw out of the hole in teh wall. If a bank goes down it would be frozen until the compensation was paid out which could be weeks.

Could you survive if you only had access to teh cash which was in your sock?

I use an internet current account, but I still have a barclays current account that's been sitting doing nothing for years. I've now moved enough money into it for month, so that if one bank goes down I still have another current account to use. Strange times hey.

I think that the Government's actions in the last few days have indicated that they will not allow a big bank to go under or any consumer to lose money. My salary is paid by a bank, I have shares with them, my pension and most of my savings are with my employer.. I could drive myself mad worrying about what if.. but you have to weigh up the risks and the 100 other things I have to worry about.

We have a business account with Natwest and a current account with Lloyds and DH could be paid in cash if necessary, so hopefully we are well covered.

I don't think its about the individual banks any more more about the whole system.

Choogirl...I know nobody will actually lose any money. They will get it back. but what happens if it takes 3m (not unrealistic)? Would you be able to live for 3-4weeks without access to your bank account before you next got paid?

Hi DNA

I really am not trying to make light of the situation, but be a bit pragmatic. The big banks really do much more than look after current accounts - so, if for the sake of argument it was one of the big 4 clearers, supermarkets and retailers would not be able to process the credit/debit card transactions, lots of people wouldn't get paid as this is run through the BACs system, cheques wouldn't get cleared as they need the clearing system which is run by the banks, big corporations would be paralysed as they wouldn't be able to complete trades, ATMs wouldn't work, etc. We'd have to go back to the old fashioned way of bartering rather than using cash. I think the media are really stiring up an unnecessary frenzy about this which is not helpful. I have spent this week working on communications to try and stop customers - some of them elderly drawing out their cash to take home and put themselves at risk from theft.