Organisation : Australian Prudential Regulation Authority APRA
Facility Name : Financial Claims Scheme
Country : Australia
Website : https://www.apra.gov.au/financial-claims-scheme-0
How is the Financial Claims Scheme activated?
The Financial Claims Scheme (FCS) can only be activated by the Australian Government, and this will only be done in the unlikely event that a bank, building society or credit union has failed and can no longer meet its financial obligations.
Related / Similar Facility: AWE Biosecurity Portal Australia
APRA’s licensing process
Step 1 – Early contact with APRA
Step 2 – Lodging an application
Step 3 – Assessment
Step 4 – Post licensing
Financial Claims Scheme
1. The Financial Claims Scheme (FCS) is an Australian Government scheme that provides protection to deposit-holders with Australian incorporated banks, building societies and credit unions (known as authorised deposit-taking institutions or ADIs), and general insurance policyholders and claimants, in the unlikely event that one of these financial institutions fails.
2.The FCS is a government-backed safety net for deposits of up to $250,000 per account holder per ADI. It also covers most general insurance policies for claims up to $5,000, with claims above $5,000 eligible if they fulfil certain criteria.
3.Once activated by the Australian Government, the FCS is administered by the Australian Prudential Regulation Authority (APRA).
4.The FCS can be activated by the Australian Government in the unlikely event that an ADI or general insurer fails.
5.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.
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
FAQ on Financial Claims Scheme
FAQ on Financial Claims Scheme are given below,
1. Who is an account holder under the FCS?
An account holder under the FCS can be:
** An individual
** a body corporate (I.e. A corporation or propriety limited company)
** a body politic
** a partnership
** any other unincorporated association or body of persons
** the trustee(s) of a trust
** the trustee(s) of a superannuation fund (including a self-managed superannuation fund)
** the trustee(s) of an approved deposit fund.
2. How is a partnership account treated under the FCS?
This will depend on how the account has been set up and who is/are the named account holder(s). If the account is held or kept in the name of a partnership, that partnership will be the account holder. However business accounts held in multiple, separate names (that are not specifically set up as a partnership account) are treated in the same manner as joint accounts, and therefore the account balance split equally between all named account holders.