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| Version 1 | Version 2 |
|---|---|
| New rules to guarantee savings | New rules to guarantee savings |
| (9 minutes later) | |
| A new scheme to protect savers with money deposited in banks or building societies has come into force. | A new scheme to protect savers with money deposited in banks or building societies has come into force. |
| Under the guarantee - promised after the run on Northern Rock - customers' first £35,000 will be fully protected. | Under the guarantee - promised after the run on Northern Rock - customers' first £35,000 will be fully protected. |
| The Chancellor, Alistair Darling, is expected to tell business leaders in London the move is part of a new system designed to shield much larger sums. | The Chancellor, Alistair Darling, is expected to tell business leaders in London the move is part of a new system designed to shield much larger sums. |
| It is thought he will announce that protection will be extended to £100,000 in the next parliamentary session. | It is thought he will announce that protection will be extended to £100,000 in the next parliamentary session. |
| Under the old Financial Services Compensation Scheme, savers have been given a guarantee for 100% of their first £2,000 of their savings, and 90% of the next £33,000. This would leave them with just £31,700 of their savings if a bank did go bust. | |
| But the Association of British Insurers has warned that a much more generous savings guarantee scheme could distort the savings market, drawing people towards cash savings and away from investment products. | |
| BBC political correspondent James Hardy said that Mr Darling was stepping up efforts to restore public confidence in the banking system after Northern Rock's near-collapse. | BBC political correspondent James Hardy said that Mr Darling was stepping up efforts to restore public confidence in the banking system after Northern Rock's near-collapse. |
| Previously, the chancellor had guaranteed protection for Northern Rock's savers, but the new guarantee applies to every bank and building society. |