Pension
Savers will see cash piles of up to £85,000 protected from bank or building society failures, a £10,000 increase iStock

Savers will see cash piles of up to £85,000 protected from bank or building society failures – following a £10,000 rise in the protection level.

The move from the Financial Services Compensation Scheme (FSCS) comes into force today (30 January), following the slide in the pound following June's Brexit vote.

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The rise brings the UK into line with the €100,000 threshold set across the European Union.

Since Britain's referendum to leave the European Union sterling has fallen some 18% against the dollar and around 11% against the euro.

The scheme covers money in current accounts, savings accounts, and cash ISAs. Joint accounts have a protection level of £170,000.

The amount of cash the scheme guarantees has fluctuated based on the performance of the pound. Last January the scheme was cut from £85,000 to £75,000 due to a prolonged strong showing from sterling.

Mark Neale, chief executive of the FSCS, said: "The limit increase will protect even more of peoples' savings. The new limit will protect about 98% of people so it is worth people knowing their limits."

Some MPs have called for a settled level of compensation, which they say will increase public awareness of the scheme.