About the Financial Claims Scheme
The Financial Claims Scheme (FCS) is an Australian Government scheme that was established during the 2008 global financial crisis to provide financial protection for consumers in the unlikely event of a failure of a bank, credit union, building society or general insurer.
The FCS provides protection for depositors of banks, credit unions and building societies that are incorporated in Australia (also known as authorised deposit-taking institutions or ADIs), for deposits up to $250,000 per account holder per ADI. The scheme aims to return deposits to account holders within seven days of activation of the FCS.
The FCS also covers claims of up to $5,000 from policyholders and claimants against general insurers in Australia, as well as providing protection for eligible claimants for claims above that.
The FCS can be activated by the Australian Government in the unlikely event that an ADI or general insurer fails.
Once activated, the FCS will be administered by APRA.
The objectives of the FCS are to:
- protect depositors of ADIs, and claimants of general insurers, from potential loss in the unlikely event of the failure of these institutions;
- provide depositors with prompt access to their deposits that are protected under the FCS; and
- support the stability of the Australian financial system.
Internationally, the protection of deposits is known as deposit insurance, and the protection of policyholders as an insurance guarantee scheme. They are both common features of the financial system in many countries. APRA is a member of both the International Association of Deposit Insurers and the International Forum of Insurance Guarantee Schemes.
What institutions does the FCS cover?
The FCS covers ADIs incorporated in Australia and authorised by APRA that are:
- banks;
- building societies; and
- credit unions.
The FCS also covers all APRA-regulated general insurers.
A list of ADIs covered under the FCS can be found here.
A list of general insurers covered under the FCS can be found here.